Compensation Court of New South Wales CITATION : Lloyd v Norther Rivers Charity Racing Association [2001] NSWCC 27 Kathleen Agnes Lloyd PARTIES : Bronwyn Kimberley Lloyd The Norther Rivers Charity Racing Association MATTER NUMBER(S) : 39398 of 1999; 12698 of 1996 JUDGMENT OF: Walker J at 1 :- ss 59(f) 60 61(1) CATCHWORDS: 61(5) 61(8) 159(2)(A) 1987 Act construed. Intention to enter in binding legal relations in contracts for medical and related services involving family members. The law of necessaries and s 60 contracts Promissory estoppel where insurer guilty of unconscionable conduct LEGISLATION CITED: CASES CITED: DATES OF HEARING: 16/7/98, 28/9/98, 29/9/98, 30/9/98, 13/10/98, 14/12/98, 31/3/99, 12/8/99, 13/8/99, 17/8/99, 20/8/99, 20/12/99, 21/12/99, 22/5/00, 23/5/00, 24/5/00, 4/10/00 DATE OF JUDGMENT: 05/09/2001 FOR APPLICANT: Mr H Bauer instructed by McLellands Solicitors appeared for the Protective Commissioner, Mr A Cooley instructed by Hemphill & Co Solicitors appeared for Kathleen Lloyd LEGAL REPRESENTATIVES: FOR RESPONDENT: Mr P Hall QC with Mr D Priestley instructed by Hunt & Hunt Solicitors JUDGMENT: THE CITATION 1. In my judgment of 12 August 1999 I ordered that matter No 12698 of 1996 and matter No 39398 of 1999 be heard concurrently. 2. Two claims for compensation require my decision in respect of the application by the Protective Commissioner on behalf of Bronwyn Kimberley Lloyd viz: 1. A claim for weekly benefits pursuant to s 36 and s 37 of the 1987 Act and 2. A claim for s 60 expenses for 24 hour attendant care as defined by s 59(f) of the 1987 Act. 3. I have directed that the latter claim be heard concurrently with a claim by Kathleen Agnes Lloyd, the workers mother and the provider of the attendant care services. Mrs Lloyd's claim relates to the same s 60 expenses but is brought pursuant to the provisions of s 61(8) of the 1987 Act. For reasons of convenience and manageability of the size of the judgments I have written a separate judgment in respect of the s 60 claims. I have labelled the weekly benefits claim "No 1" and the s 60 claims "No 2". HISTORY OF THIS LITIGATION DISCUSSION 4. More than 8 years have elapsed since Kim Lloyd was injured and over 4 years have passed since this suit was commenced. It has occupied some 21 days of the Courts time not including time spent before the Registrar resolving lengthy interlocutory matters. I recount these statistics because I take the view that in a jurisdiction that prides itself on disposing of run of the mill cases in 6 months and 98 per cent of cases within 15 months reasons for this extraordinary delay should be given. 5. A detailed history of the litigation in addition to providing a useful chronology also assists the reader understand the flexuosity of the s 60 claims and defences precipitated by sea changes in the case law, freshly emerging evidence and changes in the parties and their circumstances. 6. Underlying the protracted nature of the suits is the profound injury to Kim Lloyd and the potentially high financial stakes involved. The s 60 claim as originally pleaded sought orders for payment of the costs of attendant care 24 hours per day. In 1998 dollar values it amounted to over $100,000 annually. Aside from Kim Lloyd's brain damage and permanent orthopaedic disabilities she is in good health and might well have a life expectancy exceeding 60 years. Unlike verdicts in tort s 60 claims are not amortised. THE CHRONOLOGY 1. Kim Lloyd age 19 years, a jockey in a horserace at the Corindi Race Track on 17 January 1993 fell from her mount sustaining severe brain damage and extensive orthopaedic injuries to her spine, right leg and right arm. She was taken to Royal North Shore Hospital in a coma. 2. After some 16 weeks in a comatose state she gradually revived and received extensive treatment at the Royal Rehabilitation Centre Ryde for both her brain damage and orthopaedic injuries. 3. On 10 June 1993 Kim Lloyd was transferred to the rehabilitation unit of St Vincent's Hospital Lismore for further treatment. After a period she was allowed to visit her family at Half Way Creek on weekends. 4. On 28 October 1993 Kim Lloyd was discharged into the full time care of her mother Kathleen Lloyd. 5. The case understandably gained considerable media coverage and the respondents insurer The GIO, publicly announced that it would accept liability and paid for Kim Lloyd's hospital and rehabilitation expenses. The manner and extent of that acceptance has generated this litigation. 6. In December 1993 the GIO's Lismore Office commenced payments of $13 weekly benefits pursuant to Division 2 of part 3 of the 1987 Act to Kim Lloyd and a payment of $100 per week to her mother Kathleen Lloyd. From 21 October 1994 the payment to Mrs Lloyd was increased to $300 per week. 7. In early 1995 Mrs Lloyd instructed McLellands Solicitors to act on Kim Lloyd's behalf concerning Kim's rights under s 66, s 36 and 37 and the adequacy of the s 60 carers allowance she as a service provider was receiving. Correspondence was entered into concerning these matters during 1995. The only outcome was that Kim Lloyd's weekly benefits were increased to $14.70 on her 21st birthday allegedly pursuant to s 44 of the 1987 Act. 8. On 26 September 1996 Application for Determination No 12689 of 1996 was issued claiming lump sum compensation pursuant to s 66 weekly benefits pursuant to s 36 and s 37 and s 60 expenses for a full time carers allowance. The s 66 claim was eventually resolved and terms of settlement filed on 13 December 1996 awarding the maximum payment then available for lump sum compensation of approximately $252,000. 9. A second Application for Determination was issued on 27 September 1996 but subsequently discontinued. 10. The outstanding claims for weekly benefits and a carers allowance were set down to be heard by Judge Neilson on 27 April 1997. On the respondents application the hearing date was vacated. 11. On 20 May 1997 Judge Neilson appointed The Protective Commissioner as tutor for the applicant and transferred the hearing to the Grafton circuit. 12. A series of interlocutory skirmishes before Judge Moran and Acting Judge Bagnall in February 1998 were eventually referred to Judge O'Meally the circuit judge for determination on 26 March 1998. Judge O'Meally declined to hear the matter and referred it back to Judge Moran who in turn denied an application for a special fixture and referred the case to me for hearing as a one day case in the Grafton sittings commencing on 16 June 1998. 13. On 26 June 1998 the Guardianship Board of NSW heard an application by Mrs Kathleen Lloyd and the Protective Commissioner was appointed to manage the affairs of Kim Lloyd pursuant to the provisions of the Protected Estates Act 1983. 14. I commenced hearing the case at Maclean on 16 July 1998. Mr Bauer appeared for the Protective Commissioner and Mr Gambi for the respondent. Mr Bauer's summary of the applicants s 60 case indicated that his client relied upon the decision of His Honour Judge Burke in Manning v NSW Sugar Milling Cooperative Ltd (1998) 14 NSWCCR 612 who on applying the common law principle in Griffiths v Kerkemeyer (1977) 139 CLR 161 found that nursing services provided voluntarily by an injured workers wife were a cost within the meaning of s 60 of the Workers Compensation Act 1987. 15. Declaratory Orders were sought concerning the past and future attendant care of Kim Lloyd. Simply put the claim for past attendant care went to the reasonableness of the s 60 payments arguing that instead of being paid $100 and then $300 per week for that care Mrs Lloyd should have been remunerated at a much higher rate assessed by Dial an Angel. The claim for future care offered the Court the option of either appointing an agency such as Dial an Angel or an individual as the carer. The medical evidence tendered strongly suggested that an agency was the appropriate option. 16. Mr Gambi for the respondent submitted that nursing services provided voluntarily by a workers mother were not compensable pursuant to s 60 of the 1987 Act. His submission was that Judge Burke was in error in Manning's Case and the common law principle in Griffiths v Kerkemeyer had nothing to do with the Workers Compensation Act. 17. Five witnesses namely Kim Lloyd, Marion Lloyd, Tonya Alward, Marie Barnes and Kathleen Cunningham gave evidence. I adjourned the case for hearing in Sydney on 28, and 30 September 1998. 18. On 27 August 1998 the Court of Appeal in NSW Sugar Milling Co-operative Ltd v Manning (1998) 16 NSWCCR 606 allowed the appeal from Judge Burke' s decision finding him to be in error in applying the principle in Griffith v Kerkemeyer to cases under s 60 of the Act. It found that voluntary services were not a "cost" within the meaning of s 60 which was interpreted as an indemnity section empowering the making of orders that an employer pay a workers bills. 19. During the proceedings on 16 June 1998 I had raised with Mr Bauer my perception that there may be a conflict of interest between his client and Mrs Kathleen Lloyd. On or about 24 September 1998 Mr Ryan of McLellands Solicitors referred Mrs Kathleen Lloyd to Robert William Hemphill Solicitor to obtain independent advice. On 25 September 1998 he had a conference with Mrs Lloyd. The outcome of that conference was that on Mrs Lloyd's instructions Mr Hemphill served the Protective Commissioner with a letter of demand together with a bill for indemnification for $453,609. 20. On 28 September 1998 the matter came on for hearing in Sydney. Mr Bauer advised the Court that Mrs Kathleen Lloyd was now separately represented by Mr Hemphill. Mr Bauer acknowledged the Court of Appeal decision in Manning but declared it should be distinguished. Mr Gambi's submission was that the service of the letter of demand on the Protective Commissioner was merely a device to get around the decision in Manning's case. Mr Gambi was granted leave to obtain instructions as to whether or not the respondent objected to Mr Hemphill having leave to represent Mrs Lloyd's interest at the hearing. Mr Gambi then raised the Courts jurisdiction to hear Mrs Lloyd's claim submitting firstly that it was not a claim contemplated by the Act and secondly that no conciliation process had occurred. Given these objections Mrs Lloyd was not called to give evidence as planned. Professor Oakeshott was the only witness. 21. On 29 September Branson QC announced his appearance leading Mr Gambi. Branson QC advised the Court that his client had been taken by surprise by Mrs Lloyd's claim and would need to gather evidence from TAFE teachers, therapists and GIO officers that went to Mrs Lloyd's state of mind and whether or not she had an intention to enter into a commercial relationship with her daughter. Branson QC advised that the respondents case was that there was no contractual relationship between Kathleen and Kim Lloyd and that the payments made to Mrs Lloyd by the GIO were ex gratia in nature. He further submitted that procedural fairness demanded that his client be given time to meet the new claim being presented by Mrs Lloyd. Mrs Lloyd was then called by Mr Bauer. 22. Branson QC on 30 September 1998 raised questions as to the relevance of Mrs Lloyd's evidence that might relate to the existence of a contract between herself and her daughter given Kim Lloyd's mental incapacity. I decided to accept such evidence provisionally pursuant to s 57(1) of the Evidence Act NSW 1995. Mrs Lloyd then dropped the bombshell that she was no longer prepared to continue caring for Kim unless she was properly remunerated. This announcement came as something of a shock to the respondents legal advisers. Mr Bauer having completed his clients case on the issues of weekly benefits and future attendant care asked the Court to proceed to judgment on these matters. At that point in time the respondent had presented no evidence to the Court on either matter. In particular the respondent had chosen to present no medical evidence to contradict the applicants case. Branson QC said that the only matter that the respondent wished to call evidence upon was the question of Mrs Lloyd's claim for past attendant care. Branson QC then submitted that the claim for future attendant care required the Court to make declaratory orders and that remedy was outside the Courts jurisdiction. I agreed to adjourn this case to a later date to hear further submissions. 23. The matter came on for further hearing on 13 October 1998. Branson QC advised the Court that his client had on 6 October 1998 qualified Dr John Graham an occupational physician who had recently examined Kim Lloyd at her home and prepared an 8 page medical report which contradicted the evidence of the applicants specialists Professor Oakeshott and Dr Buckley concerning the degree of attendant care required. He was instructed to make an open offer to settle the claim on the basis that the Clarence Valley Home Nursing Service would provide 12 hours a day care to Kim Lloyd. 24. Dr Graham's report had not been served within the time limits prescribed by the rules. Branson QC could not advise the Court whether Dr Graham had any qualifications in the field of rehabilitation of brain damage. I then requested Branson QC to make Dr Graham available to give evidence. After enquiries he informed the Court that Dr Graham was giving evidence in a Newcastle case and was not available. I rejected the respondents application for a further adjournment on the issue of future attendant care. Peace broke out and the parties then negotiated a settlement of Kim Lloyd's future care. I made findings as to employment; injury; applicability of s 60 and Kim Lloyd's need for 24 hour per day attendant care. I then made consent orders concerning the provision of that care. Since the commencement of hearings a running acrimonious exchange had been occurring between counsel concerning the respondents refusal to produce all its insurers files on Kim Lloyd. To resolve this dispute I referred a very large volume of documents to Registrar Cox to rule on their admissibility. I then adjourned the case to 14 December 1998. 25. On 10 November 1998 the respondent filed a Notice of Appeal against the consent award for future attendant care. 26. On 9 December 1998 the respondent changed solicitors from McCabes to Hunt and Hunt. 27. On 14 December 1998 the matter again came on for hearing. Mr Priestly represented the respondent, Mr Bauer continued to represent the Protective Commissioner and Mr Cooley sought leave to represent Mrs Kathleen Lloyd. Mr Priestley did not have instructions concerning the question of Mr Cooley's right of appearance. He did have instructions to make an application that I review my earlier consent awards. I indicated that I would only consider such an application on notice of motion. I then stood the matter over for further hearing on 31 March 1999. 28. On 31 March 1999 the appearances changed again. Mr Bauer continued to represent the Protective Commissioner, Mr Trainor sought leave to represent Mrs Lloyd and Hall QC with Mr Priestley now appeared for the respondent. Mr Trainor applied to vacate the hearing date on the basis that his client was in the process of compulsory conciliation and intended to file an Application for Determination as soon as that process was complete. 29. Hall QC then raised issues concerning locus standi of Mrs Lloyd and this Courts jurisdiction to hear her claim. He sought an early date to resolve those issues. He objected to Mrs Lloyd's interests being represented in the Protective Commissioners case concerning past attendant care of Kim Lloyd. However he was not ready to proceed in that case. I decided that I should first resolve the questions of jurisdiction and locus standi concerning Mrs Lloyd's claim and adjourned those questions to 12 August 1999. 30. I heard Kathleen Lloyd's Notice of Motion on 12 August 1999 and delivered judgment on 13 August 1999. I found: (a) That s 61(8) of the 1987 Act conferred the right upon Mrs Kathleen Lloyd to bring a claim against the respondent in respect of medical or related treatment. (b) That attendant nursing care fell within the definition in s 59(f). (c) That this Court had power to make orders in relation to such care because it was a matter arising under the Act and not the general law. (d) I also ordered that the claim be heard concurrently with that being pursued by the Protective Commissioner. 31. The concurrent hearings resumed on 17 August 1999 and 20 August 1999. Hall QC with Mr Priestly represented the respondent, Mr Bauer the Protective Commissioner and Mr Cooley represented Mrs Lloyd. 32. Mr Cooley tendered voluminous documentary evidence drawn from the files of the respondents insurer and WorkCovers files concerning the GIO's Workers Compensation Licence that primarily went to the arrangement between Mrs Lloyd and the GIO concerning the payment of the attendant carers allowance. He also called Mrs Lloyd to give evidence about those arrangements. He did so in the face of constant objections from Hall QC as to the relevance of that material. Hall QC's arguments as to relevance may be briefly summarised as follows: · My decision that Mrs Lloyd was entitled to claim pursuant to s 61(8) was wrong in law. Mrs Lloyd had no standing and the Court no jurisdiction to hear such a claim. · S 60 concerns a contractual relationship between a worker and a care provider. That is the condition precedent to finding a claim under the Act. Documentary evidence relating to dealings between the employers insurer and a carer have no relevance to that contractual relationship. · The finding of a contractual relationship between the GIO andMrs Lloyd is outside the jurisdiction of this court. · If employees of the GIO entered into a contractual relationship with Mrs Lloyd then they did so without legal authority and any agreement is not binding on either the GIO or the respondent. Again I admitted all this evidence on a provisional basis only. Evidence was also given by Julie Ann Gordon as to award rates for attendant care. 33. The matter was further heard on 20 and 21 December 1999 when Mrs Lloyd and Mr Hemphill were recalled to give further evidence. Evidence was also called by Hall QC from GIO case manager Wendy Klaus. 34. The hearing resumed on 22, 23 and 24 May when the Court heard further evidence from GIO case managers Sam Simiana, Brenda Morrow, Wayne Dickens and Karen Herne. 35. Lengthy written submissions were then prepared and served and final addresses delivered. On 4 October 200I granted Mr Bauer leave to make further written submissions because of his commitments in the Glenbrook Rail Disaster Inquiry. A. THE RESPONDENTS SUBMISSIONS 7. Hall QC's submissions were lengthy and complex but they can be tersely summarised as follows: 1. Liability Under the Act. The S 60 Regime · Both claims are brought pursuant to the provisions of Part 2 Division 3 of the 1987 Act. Liability to pay statutory compensation must be found within the express or implied terms of that legislation. · The provisions governing entitlement to compensation under Division 3 are to be found in s 60 and relevantly within the provisions of s 60(1). There is no jurisdiction for the Court to entertain claims independently founded upon s 61(8) or upon a contract between the GIO and Mrs Lloyd. · An employer cannot be liable to pay for the costs of a treatment or service unless an underlying or primary liability has arisen between the service provider and the worker. 2. Legally Binding Contractual Relationship 8. Manning's Case has clearly established the principles governing the determination of rights and liabilities in respect of medical treatment under the Act. Any claim must prove: · Contractual liability between a worker and service provider that gives rise to a "cost" in relation to specified services. · An obligation on the employer to indemnify the worker for that cost. 9. Those requirements have not been proved because: · The Court ought to infer from the evidence that Mrs Lloyd commenced to care for her daughter solely because of their familial relationship and there is no evidentiary basis for concluding that there was an intention to enter into a legal relationship or to require payment from her daughter. · The right of action under s 61(8) is derivative not substantive relying upon proof of entitlement under s 60. 10. Hall QC submitted that this Court should apply the common law principle in Balfour v Balfour that in contracts cases involving family relationship the inference is that there is no intention to enter into legal relations. 11. Hall QC also submitted that this was not a case to which the law of necessaries could be said to apply because of the principle in In Re Rhodes that in order to raise an obligation to repay, the money must have been expended with the intention on the part of the person providing it that it should be repaid. Hall QC's submission is that Mrs Lloyd never intended to constitute herself a creditor of her daughter. 12. Hall QC made it clear that he was not disputing in any way his clients liability to pay the very substantial hospital and medical expenses incurred in the treatment of Kim Lloyd. This was so notwithstanding Kim Lloyd's undoubted inability to enter in contracts when she was in a coma or subsequently because of her lack of mental capacity. He suggested that the neurosurgeons and rehabilitation specialists were rendering services with the clear intention that if they were not paid they had a right of recovery. However his submission is that this was not the case with Mrs Lloyd. 3. Estoppel 13. Hall QC rejected the suggestion that any estoppel arises here from the GIO's payment of the allowance of $300 per week to Mrs Lloyd. His submission is that the relationship between the GIO and Mrs Lloyd is a matter outside the jurisdiction of the Court and even if there was an estoppel it could not be entertained. B. KATHLEEN LLOYD'S SUBMISSIONS 14. Mr Cooley's arguments were also complex and often put in the alternative. A brief summary may not do them the credit they deserve but I will do my best: · The case of Kim Lloyd must be distinguished from the decision in Manning . Mrs Lloyd, notwithstanding her familial relationship has proved that at the relevant point of time she formed the intention to hold her daughter liable for her services. · Subject to the Courts findings on the evidence Mrs Lloyd's intention to bind her daughter existed from either: (a) When she assumed care of Kim on 28 October 1993; (b) The point in time in 1993 when the GIO (Lismore) agreed that she be paid the sum of $100 per week for her services or; (c) From the point of time in late 1994 when an indigent Mrs Lloyd reopened negotiations with the GIO Lismore concerning the adequacy of her allowance which resulted in the payment by the GIO to her from October 1994 of $300 per week; (d) From the point in time in December 1994 when on learning of the increase to $300 per week she was still dissatisfied and consequently saw McLellands Solicitors early in 1995 for advice and gave instructions that legal action be taken to increase the allowance; (e) From 21 September 1995 when the GIO was provided with a copy of the Application for Determination to be issued on Kim Lloyd's behalf claiming the carers allowance; (f) From 5 June 1996 when McLellands furnished a detailed accounting of Mrs Lloyd's claim to the respondents solicitors; (g) From the appointment of the Protective Commissioner on 26 June 1998 to be Kim Lloyd's legal personal representative. (h) From October 1997 when Mrs Lloyd began submitting regular day by day accounts to the GIO Newcastle for her services; (i) From 28 September 1998 when Mr Hemphill served the served the Protective Commissioner with a bill from Mrs Lloyd seeking indemnification for her services to the worker. · Mr Cooley grounds his clients claim in s 61(8). However, he does not quibble with the proposition that in order to substantiate the claim his client needs to prove the fundamental requirements of s 60. He rejects those parts of the respondents submissions that suggest that because Kim Lloyd had no mental capacity to enter into a contract then the fundamental requirement in Manning that a binding contract between the worker and service provider must exist has not been met. He asserts Manning should be distinguished because it did not involve the circumstance of a worker who was incapable of entering into a binding legal relationship. Mr Cooley asserts that Mrs Lloyd's attendant care services were necessaries and the common law implies an obligation upon Kim Lloyd as a mentally disordered person to pay for necessaries supplied to her. · Mr Cooley further relied upon the provisions of S 61(1) and S 61(5) of the 1987 Act to establish Mrs Lloyd's right to obtain an award for reasonable costs of the care she provided as opposed to the $100 and $300 per week the GIO elected to pay to her. · Mr Cooley finally submits that the employer is estopped by its unconcionable conduct involved in the payment to Mrs Lloyd of an attendant care allowance from denying her right to such an allowance. C. THE PROTECTIVE COMMISSIONERS CASE 15. Mr Bauer agreed to make written submissions but his involvement with the Inquiry into the Glenbrook Rail Disaster eventually made that impossible. 16. Since the intervention of Mrs Lloyd the Protective Commissioner has not taken a pro-active role in the claim for past attendant care no doubt taking the view that Mrs Lloyd's legal representatives are best fitted to put her case. 17. Since the decision in Manning's Case Mr Bauer's position has simply been that the case needs to be distinguished from Manning because of Kim Lloyd's mental incapacity and the application of the law of necessaries. MATTERS FOR DETERMINATION Injury and Employment 1. Was Bronwyn Kimberley Lloyd injured arising out of and in the course of her employment with the respondent? 2. If so did she sustain permanent physical and psychological injuries? Workers Capacity to Contract 3. Is the worker as a result of her psychological injuries incapable entering into a binding contract? Jurisdiction of this Court 18. Has Kathleen Lloyd the standing to bring and has this Court the jurisdiction to hear her claims against the respondent: (a) As a service provider pursuant to s 61(8) for the payment of medical or related expenses? (b) In contract or quasi contract against the employers workers compensation insurer in respect of any alleged agreement to provide s 59(f) services to the worker? (c) By way of a right of action for promissory estoppel in respect of alleged representations by the GIO as to Mrs Lloyd's rights to receive payments as an attendant carer? S 60 Expenses 5. Is there a binding contract between the worker and her mother which would constitute Mrs Lloyd a creditor of her daughter for her services an attendant carer? 6. More specifically: (a) Were the services provided by Mrs Lloyd necessaries? (b) If so were those necessaries supplied by Mrs Lloyd as a maternal benefactress or did she intend that her daughter be legally bound to pay for the services? 7. Is the respondent estopped from denying the existence of a binding agreement between the worker and Mrs Lloyd because of representations it made to Mrs Lloyd causing her to act to her detriment? 8. Were the services provided by Mrs Lloyd medical or related expenses within the meaning of s 59(f)? 9. If so, were the services provided by Mrs Lloyd: (a) at the direction of a medical practitioner? (b) appropriate to the workers condition? (c) capable of alleviating the consequences and effects of her work related disabilities? (d) Was the cost of that treatment reasonable in all the circumstances of the case? In particular were there less expensive or more appropriate treatments available? S 61 Amount for which Employer Liable under s 60 10. (a) Does s 61 empower this Court to fix the amount for which an employer is liable under s 60 at a rate it determines to be reasonably appropriate to the treatment required in all the circumstances of the case? (b) If so, has the respondent discharged its onus to prove what is the customary charge made in the community for such services to persons other than workers having regard to the reasonable necessity of the treatment? If not is the amount claimed in the workers bill reasonably appropriate in all the circumstances of the case? (c) Should the Court accede to the workers and Mrs Lloyd's applications and direct that the employer is liable for an amount additional to that fixed by s 61(4)? Interest 19. If the worker is entitled to be indemnified in respect of the bill submitted is she entitled to interest on the sum ordered to be paid under s 60? If so what is the appropriate interest to be included in the award? THE LAW 20. Before I proceed to address the matters for determination in this claim I should first review the law I will be required to apply. 21. I have identified the areas of law I am required to address as follows: · The proper construction of s 59(f) · The proper construction of s 60 · Intention to enter into binding legal relations · The law of necessaries · The proper construction of s 61(1) and s 61(5) · Whether s 61(8) provides an independent right of action. · Estoppel 1. CONSTRUCTION OF S 60 22. Before I address the contentious issues here which relate to the proper application of the principles in Manning's Case I should first refer to the case law which establishes the other necessary elements of proof required in claims for medical and related benefits. 23. S 60 relevantly provides: 60(1) If, as a result of an injury received by a worker, it is reasonably necessary that: (a) any medical or related treatment be given..... the workers employer is liable to pay, in addition to any other compensation under this A ct, the cost of that treatment or service and the related travel expenses specified in subsection (2). (3) Payments under this section are to be paid as the costs are incurred, but only if properly verified.... S 59 relevantly provides a definition of medical or related t reatments: S 59(f) relevantly provides: Medical or Related Treatment includes: (f) care (other than nursing care) of a worker in the workers home directed by a medical practitioner having regard to the nature of the workers incapacity.... 24. There is no suggestion in Hall QC's submissions in either Manning or the present case that the nature of the care claimed on Kim Lloyd's behalf does not fall within the definition in 59(f). Nevertheless there are two aspects of this claim in respect of which I take the view that this Court should exercise care in its determination. Firstly the distinction between nursing and home care is ultimately relevant to the question of "cost" because the remuneration of a registered nurse is considerably greater than an unqualified carer. I raise this distinction because it is clear from the evidence that some of the key services provided by Mrs Lloyd such as administering medication, bathing, toiletting and rehabilitation are usually associated with nursing. However the High Court in Thomas v Ferguson Transformers Pty Ltd (1981) 145 CLR 625 at 682 and 686 made it clear that it is not only the nature of the services that is determinative here but the setting or context in which those services are provided. This point was reinforced by the Court of Appeal in Our Lady of Loreto Nursing Home v Olsen (2000) 19 NSWCCR 465 at 47 where Justice Handley said of care involving driving and hydrotherapy: These activities, however beneficial, called for no special skill or experience on the part of the carer. In my judgment the evidence established that the care thus given by Mrs Tunks was not nursing in the context of medical or related treatment provided for a worker within s 59 and s 60. 25. The second matter relates to a decision of the Court of Appeal delivered after submissions to which I propose to refer to shortly. 26. The respondent has consented to an award for present care on a 24 hours per day basis. That consent award was taken on appeal but the appeal did not proceed. Instead the respondent now has before the Court a Notice of Motion pursuant to s 17(4) of Compensation Court Act 1984 to review that decision. Evidence supporting that motion is not before me in this case. In the circumstances I have taken the view that the Court must assume the respondent puts both Kathleen Lloyd and the Protective Commissioner to full proof in respect of the application of s 60. 27. The principles applicable to determine what is "reasonably necessary" applied by all Judges in this Court for the past 15 years were set out by His Honour Judge Burke in Rose v Health Commission (NSW) 1986 2 NSWCCR 32 at 47 and Pelama Pty Ltd v Blake (1988) 4 NSWCCR 264. Given the Court of Appeals strong disagreement with Judge Burke's approach to the interpretation of s 60 and related sections one hesitates to be dogmatic about their applicability. However they are of long standing, are regularly applied by Judges of this Court and read: 1. Prima facie, if the treatment falls within a s 59 definition then it is relevant medical treatment for the purposes of the Act. 2. That presumption is rebuttable by showing that the particular treatment afforded is not appropriate or is not competent to alleviate the effects of injury. 3. Any necessity for relevant treatment results from the injury where its purpose and potential effect is to alleviate the consequence of the injury. 4. It is reasonably necessary that such treatment be afforded a worker if this Court concludes, exercising prudence, sound judgment and good sense, that it is so. That involves the Court in deciding, on the facts as it finds them, that the particular treatment is essential to, should be afforded to, and should not be forborne by the worker. 5. In so deciding, the Court will have regard to medical opinions as to relevance and appropriateness of the particular treatment, any available alternative treatment, the cost factor, the actual or potential effectiveness of the treatment and its place in the usual medical armoury of treatments for the particular condition. Manning's Case 28. Hall QC rests the respondents case very firmly on the foundations of the decision in NSW Sugar Milling Co-Operative Ltd v Manning (1998) 16 NSWCCR 606. In that case the Court of Appeal unanimously found that nursing or therapeutic services provided to a worker on a voluntary basis was not a "cost" within the meaning of s 60. 29. The decision in Manning was uncontroversial in so far as it followed the long settled authority that s 60 was an indemnity section empowering the making of orders that the employer pay for the cost of his employees medical expenses. 30. In the context of the facts of this case Hall QC, in my view correctly, states the implications of Manning for the claims on behalf of Kim Lloyd and Kathleen Lloyd namely they must be founded upon: 1. a binding contract for service made between the worker and the service provider and 2. a claim made by the worker by the presentation of a bill for indemnification of costs incurred under that binding contract. 31. Those conclusions are clear from the reasoning of Justice Meagher who wrote the leading judgment with which Justice Sheppard and Justice Stein agreed. At page 611.13 Justice Meagher said: I think Mr Hall QC, learned senior counsel for the appellant, was correct in his submission that the section is an indemnity section; it empowers the making of orders that the employer pay his employees bills. That is the obvious primary meaning of the word "cost". It is also what is required by par (b) and par (d) of s 60. Further, it is also the obvious meaning of most of the paragraphs of definition in s 59. 32. At page 611.11 Justice Meagher also stated It goes without saying that there was no contract between Mr & Mrs Manning whereby he was obliged to pay for her services. 33. Justice Meagher describes s 60 as an indemnity clause which empowers the making of orders that an employer pay his workers bills. At paragraph 14 he makes the distinction between an action for damages in tort and one for the recovery of costs: However in cases like the present, no action for damages is involved; nor is the central rationale of such an action relevant; all which is involved in interpreting the meaning of an indemnity clause in a statute. 34. In this context the word "indemnity" is not being used in its primary dictionary meaning of something paid by way of compensation for a loss incurred but as a term of art drawn from the law of contract which carefully distinguishes between indemnification of contractual obligations and a right to damages founded elsewhere in tort or in statute. 35. In Coyle v Government Dockyard Walsh Island (1929) 29 SR (NSW) 539. ACJ Ferguson held at page 540 that s 10(7) of the 1926 Act: was a section for the compensation of workers, and was directed only to the indemnity of workers against the cost to them of the treatment of their injuries.... S 10 falls within part 2 of the Act, which relates to compensation, s 7, the first section in that part, provides that a worker who receives personal injury in the circumstances there mentioned shall receive compensation from his employer in accordance with the Act... S 10 was intended to indemnify the worker against the cost of medical, surgical and hospital treatment. This clearly means the cost to him. 36. In Salmon v Stirling Henry Pty Ltd (1953) WCR (NSW) 153 at page 155. His Honour Judge Rainbow explained the basis upon which workers could recover medical expenses in the following terms: It is a matter of common sense. You cannot recover compensation until you have lost something. If not legally liable to pay, you cannot ask the employer to reimburse you. 37. Those decisions reflected the state of the law before the decision of the High Court in Griffiths v Kerkemeyer (1976 - 1977)139 CLR 161 when workers did not have rights in tort in cases involving the gratuitous provision of medical or related services. There the High Court held that services provided gratuitously by a woman to her permanently disabled fiance were recoverable as damages even thought the plaintiff was under no contractual liability to pay for those services. 38. It has long been accepted that the principles of tort and workers compensation law do not differ fundamentally see Baker v Willouby (1970) AC 467, Bushby v Morris (1980) 1 NSWLR 81 at 87D. 39. Whilst liability under s 60 was thought prior to 1976 to be restricted to contractual liability there was no suggestion in Coyles Case or Salmon's Case that the cost that was to be indemnified was the "financial cost" as determined by an executed contract. 40. The perception of practitioners in the field of workers compensation prior to "Manning" was that it was this Court, not the contract for medical services that must determine the costing of the bill by reference to a range of criteria that went to the reasonable necessity for the treatment; whether it was directed by a legally qualified medical practitioner; whether it fell within the definition of medical treatment; whether it fell within the cap applied to such expenses and whether it was reasonably appropriate to the treatment afforded having regard to the reasonable necessity for such treatment and the customary charge made in the community for such treatment to persons other than workers. 41. In other words because the price was a matter to be exclusively determined by the Court, not the contract, the assumption was that the only appropriate course to take to resolve s 60 cases was to make a claim for compensation not to sue in debt for the contract price. 42. Contrary to those preconceptions s 60 is rejected in Manning as a statutory provision entitling a worker to damages on the basis that liability is imposed upon the employer to pay the "cost" of the treatment. The definition of "cost" chosen by the Court of Appeal is the "price paid" ie the financial cost. A broader concept of "cost" was urged upon the Court by Mrs Manning's counsel which amounted to "the outlay of expenditure". Justice Sheppard suggested at paragraph 27 that such a definition was unacceptable because it would equate the word "cost" with the concept of need. 43. The learned judges could find no provision in s 59 or s 60 that would justify such an expanded meaning of the word "cost" and so concluded that unless there was a bill arising from an executed contract then no right of action existed under s 60. They rejected the proposition that in interpreting the word "cost" they should apply the principle in Wilson v Wilson's Tileworks Pty Ltd (1960) 104 CLR 328 at 355 which asserts that because the Workers Compensation Legislation is intended to benefit workers, where there are competing constructions the most advantageous to the worker should be adopted. 44. Justice Meagher concludes that not only was the construction chosen the obvious primary meaning of the word "cost" it also is what is required by par (b), par (c) and par (d) of s 60 and the obvious meaning of most of the paragraphs of s 59. Justice Stein also could discern no legislative intent to the contrary and accordingly felt it inappropriate to apply the principle in Wilson's Case. 45. I have previously commented that this narrow interpretation of the word "cost" came as something of a shock to many practitioners in the field of workers compensation who had been treating s 60 expenses as compensation claims not actions in debt for over 70 years. 46. It will no doubt come as a rude shock to severely injured and necessitous workers requiring expensive and extended medical treatment that they have no right to workers compensation until they have first taken the risk of entering into a binding contract with the service provider for those services and have a bill for the financial cost of the contract to present to the Court. I cannot see that construction of s 60 in any way promoting the beneficial purposes underlying the 1987 Act. 47. Statutes are construed according to the intent of the Parliament and that intent should be found from an examination of the language used in the statute as a whole. 48. With great respect to the learned Judges of Appeal if the words "reasonably necessary" in s 60 cannot be equated with the concept of need then the construer of s 60 need only widen the search for Parliaments intent marginally beyond the narrow confines of s 59 and s 60 to s 61 before the construction adopted by Judge Burke becomes available and the application of Wilson's case a real alternative. 49. The High Court in Haines v Bendall (1991) 172 CLR 60 at 63 defined the prime objective of the 1987 Act in the following terms: Compensation is the cardinal concept. It is the one principle that is absolutely firm and which must control all else. 50. Indeed s 60 itself defers to the primacy of the compensation concept being entitled "Compensation for cost of medical hospital and rehabilitation treatment etc" 51. Mr Cooley suggests that Judge Burke's more expanded definition of "cost" can be found by considering s 61(1) and s 61(5) which fix the rates applicable for s 60 treatment. Similar provisions also apply in s 60(A) which imposes a ceiling on what workers are liable to pay and service providers are entitled to recover; s 62 which fixes rates applicable for hospital treatment; s 63 which fixes rates for ambulance services; s 63A which fixes rates for occupational rehabilitation services and s 64 which fixes rates applicable for car travel. 52. There is no suggestion in these provisions of indemnification of providers on the basis of financial cost determined by contractual obligations. On the contrary, the Parliament has empowered the Court to ignore the parties agreed financial cost and fix a value for the medical services according to needs based criteria viz: · An amount reasonably appropriate to the treatment. · An amount fixed with regard to the reasonable necessity for the treatment. · An amount to be fixed taking regard to customary charges made to persons who are not workers in the community. · An amount to be discounted by having regard to the care that might be reasonably provided by family members. 53. I am unable to draw from those provisions a legislative intent that s 60 empowers the making of orders that an employer pay his employees bills pursuant to a binding contract. 54. It strikes me as incongruous that in a statute that is about workers compensation, not debt collection, before a statutory Court that has no jurisdiction to determine cases under the general law of contract or even to enforce its own monetary awards of compensation the Legislature would choose to enact a lone provision allowing the indemnification of debts owed by workers to service providers. 55. Having expressed that personal view the principle of stare decisis nevertheless requires that I faithfully apply the decision in Manning's Case which, of course, I propose to do. 56. Two subsequent decisions of the Court of Appeal pertaining to s 60 and s 61 need to be considered and applied in this case. 57. In Australian Brain Foundation Ltd v Hyteco (NSW) Pty Ltd (2000) unreported NSWCA 301 President Mason considered a claim for $270,550 for therapy treatment to a brain damaged worker. 58. The treatment had been given between 1986 and 1990 at the Brain Injury Therapy Centre (BITC) but was not the subject of the original claim before Chief Judge McGrath in 1990. Rather it was brought many years later before His Honour Judge Moran in 1998. I raise the matter because of the following obiter dicta from President Mason at paragraph 7 of his judgment no attempt was made to litigate the dispute in a common law action between the service provider and the worker. I am not suggesting that the matters had to proceed in this manner. But had this occurred the District Court would have had undoubted jurisdiction to determine the cost to the worker of these services and to award interest, subject to any relevant provisions of the Act. The worker would then have been given a statutory indemnity in relation to those costs as determined pursuant to s 60 of the Act (see Coyle v Government Dockyard, Walsh Island (1929) 29 SRNSW 539, New South Wales Sugar Milling Co-operative Ltd v Manning (1998) 44 NSW 442). 59. This view would appear to support the proposition that both the District Court and this Court has jurisdiction to apply the provisions of the Workers Compensation legislation to contracts for medical services for injured workers to make assessments under s 60, to fix fees under s 61 for s 60 expenses and to impose interest on the sum indemnified. 60. Later in the judgment Mason P at paragraph 32 dealt with s 61(8) and the power of this Court to include interest in an award for s 60 expenses. He recited s 109 of the 1998 Act and noted that it perpetuated the deficiency identified by the Law Reform Commission of NSW in its report "Interest on Certain Debts" LRC 35 1983. This was despite the fact that the s 94 of the Supreme Court Act and s 83A of the District Court Act had cured that particular deficiency. The deficiency identified is the requirement that the award of interest must be included in the amount for which judgment is given which allowed tender of the principal debt to remove the basis of an award for interest. He noted this problem is exacerbated by s 109(2)(b) which prevents interest being awarded for the period before the claim for the compensation was duly made. 61. In this case the s 60 claim was made on the workers behalf by McLelland Solicitors in1995 but Mrs Lloyd's s 61(8) claim was not made until 1998. What is clear to me is that notwithstanding the fact that I have separate suits before me they represent the same claim for indemnification and the respondent can only be liable to pay one award and one amount of interest upon it. 62. The second decision was in Western Suburbs Leagues Club v Everill (unreported 30 March 2001 CA 41022/99) which dealt with the proper construction of s 59(f). Hall QC did not dispute that the services provided fell within the meaning of s 59(f). He may well have done so if Everills case had been decided before his submissions were made. 63. In summary the Court of Appeal held: 1. That although Parliament had widened the definition of medical and related treatment when it enacted s 59(f) that expansion of workers rights nevertheless fell short of conferring a right to domestic assistance or housekeeping assistance. 2. A worker who is unable to look after herself either at all, or without suffering unacceptable pain, is entitled to the cost of personal care. However she is not entitled to the cost of providing care for others and she is not entitled to the cost of domestic assistance or household help as such. 3. The care must be directed by a medical practitioner having regard to the workers incapacity which that practitioner can assess. 64. Everills case would not affect the provision of personal attendant care for Kim Lloyd (provided it was directed by a medical practitioner). However it does raise some difficult questions about the other services Dial an Angel have rolled into the assessment including housekeeping assistance and would appear to put paid to any claim for "handyman and gardener services". 2. INTENTION TO ENTER INTO LEGAL RELATIONS 65. It is the body and soul of the respondents case that the care provided by Mrs Lloyd to her daughter was gratuitous. Hall QC submits that the Court should find that Mrs Lloyd provided care to Kim from October 1993 solely because she was her daughter and there is no basis for concluding that she expected or required payment from her daughter. 66. The platform for this argument is the consensus that Kim Lloyd did not have the capacity to form an intention to enter into a contract. It is the respondents further submission that no person, including Mrs Lloyd ever intended to do so on her behalf. This argument relies upon the statement by Justice Meagher in paragraph 11 of his judgment in Manning that: It goes without saying that there was no contract between Mr and Mrs Manning whereby he was obliged to pay for her services. 67. Hall QC puts great reliance on this sentence in building his case that the care was gratuitous in nature. Indeed I believe it fair to say that he goes so far as to attempt to draw from the statement a principle of law that in s 60 cases this Court cannot find a liability under the Act when the service being provided is by one family member for another. He puts that proposition in various ways but in paragraph 18 of his written submission he says: The fundamental matter in the present case is that, until the Court of Appeal in Manning exposed the fallacy of imputing a liability between family members and the fact that s 60 is intended to operate as an indemnity provision, it had not been established that no liability arises under s 60. 68. Before I address this question I should first review the authorities on intention to create legal relations in contract law generally and in contracts for necessaries in particular. 69. For many years now debate has raged in our Courts as to whether a subjective or objective test should be applied in determining intention to enter into contractual relationships. 70. The outcome is that under present Australian law this Court is not concerned with the real intention of Mrs Lloyd but with the outward manifestations of that intention (see Taylor v Johnson (1983) 151 CLR 422 at 428). 71. The principle as formulated in English law was enunciated by Salmon LJ in Jones v Padavatton (1969) 1 WLR 328 at 332 as Did the parties intend the arrangement to be legally binding? This question has to be solved by applying what is sometimes (although perhaps unfortunately) called an objective test. The Court has to consider what the parties said and wrote in the light of all the surrounding circumstances, and then decide whether the true inference is that the ordinary man and woman, speaking or writing in such circumstances, would have intended to create a legally binding agreement. 72. The principle was put by Pollock CB in Cornish v Abigton (1859) 4 H&N 549 at 556. If any person, by a course of conduct or by actual expressions so conducts himself that another may reasonably infer the existence of an agreement…. Whether the party intends that he should do so or not, it has the effect that the party using that language or who has so conducted himself, cannot afterwards gainsay the reasonable inference to be drawn from his words or conduct. 73. The appropriate Australian test was described by Justice Windeyer in Placer Development Pty Ltd v Commonwealth (1969) 121 CLR 353 at 367 where he said that it was not whether the parties "had expressed or exhibited an actual and positive intention that their agreement was to result in legal obligations. It depends rather on an inference to be drawn from the subject matter and nature of their agreement and other circumstances." 74. The common law has long taken the view that in the course of family life there will be many agreements made which are never intended to become the subject of litigation (see Balfour v Balfour (1919) 2 KB 57 and Rose & Frank Co v J. R Crompton & Bros (1925) AC 445). 75. The basis upon which family agreements are said not to be binding is that the parties never intended to affect or give rise to legal relations or to be attended by legal consequences (see Dixon J in Cohen v Cohen (1929) 42 CLR 91 at 96). 76. However the authorities have never propounded the hard line principle that Hall QC would distil from Justice Meagher's remarks at para 11 that all contracts for services between family members are not intended to be binding. 77. On the contrary, the case law is clear that the relationship of husband and wife by no means precludes the formation of a contract provided a clear intention to be bound can be established see Merritt v Merritt (1970) 2 AIIER 760, Milliner v Milliner (1908) 8 SRNSW 471, Popiw v Popiw (1959) VR 1997. 78. In Pettitt v Pettitt (1970) AC 777 Lord Diplock at page 882 said many of the ordinary domestic arrangements between man and wife do not possess the legal characteristics of a contract. So long as they are executory they do not give rise to any chose in action for neither party intended that non performance of their legal promises be the subject of sanctions in any Court (see Balfour v Balfour). But this is relevant to non performance only. If spouses do perform their mutual promises the fact that they could not have been compelled to do so while the promises were executory cannot deprive the acts done by them of all legal consequences. 79. This case deals with a mother-daughter relationship but the Courts have applied a similar presumption to other close domestic relationships. Again the presumption is rebuttable by proof that notwithstanding the existence of family ties the parties intended to affect their legal position. 80. The case law here is careful to identify the subject matter of the contract and distinguish between agreements of a domestic as opposed to a commercial nature. 81. In Roufos v Brewster (1971) 2 SASR 218 Chief Justice Bray said in a case involving a father-in-law suing his son-in-law for damage to a truck: It is true that the appellant is the son-in-law of the respondents, but they were conducting separate businesses at Coober Pedy - the respondent had an important commercial interest in the transport of his liquor to Coober Pedy for the purpose of his new restaurant... just as the respondents had a commercial interest in regaining the use of their truck as soon as possible. The whole setting of the arrangement is commercial rather than social or domestic. 82. Similarly in Wakeling v Ripley (1951) 51 SR (NSW) 183, a suit by a brother against his sister, Street CJ said at page 187: I think the parties did intend to enter into a binding enforceable contract, or, at any rate, there was ample evidence from which the jury could draw such an inference. 83. A consistent thread in these authorities has the Court addressing the question of whether one party would take such a drastic step without believing the other to be bound by the promise. For example the gravity of the detriment to the promisee was seen as relevant to the question of intention to create legal relations in Todd v Nicol (1957) SASR 72 at 79 and Wakeling v Ripley (Supra) at page 187). 84. I should make more detailed reference to several cases involving a parent attempting to bind a child. 85. In Jones v Padavatton (Supra) the Court found that a promise by a parent to pay a child a study allowance to induce the child to enter a particular course of study could be binding. 86. In Haggar v Placido (1972) 1 WLR 716 a tetraplegic injured in a motor vehicle accident sought to claim by way of damages the costs of full time nursing care provided to him by his mother. This care was provided pursuant to a written agreement which prima facie created a legal liability between the tetraplegic and his mother. The Court found that agreement to be an artifice but concluded it was a successful one because the agreement was legally binding. 87. The same issue came before the English Court of Appeal in Donnelly v Joyce (1974) QB 454 where an injured infant sued for his mothers loss of wages while she cared for him. The issue was whether or not the infant was under a legal obligation to reimburse his mother. The Court of Appeal strongly disagreed with finding in Placido. Lord Justice Megan said at p 464:- If you incur expenses or render services on behalf of a person who cannot contract because he is unconscious, or is a child, or mentally incapable you do so for the financial benefit of the wrong doer. If that were the law, it would we think be regrettable. Many people we believe, world prefer that the loss should go uncompensated rather than they make bargains in such circumstances. Many persons would be distressed at the very fact that such a bargain was made, even if they understood its purpose. Many people if they did plan to make such a bargain, would not intend for one moment that however the agreement might be phrased it should create any legal effect in accordance with its terms; that is the imposition of an enforceable liability upon the injured person. If such were the law, legal advisers would we believe often be gravely embarrassed at having the duty to advise such agreements should be made. 88. The High Court of Australia took a somewhat different approach to a similar issue in Blundell v Musgrave (1956) 96 CLR 73 where a naval rating injured on leave by a third party had been billed by the Naval Board for the costs of his medical expenses. It was likely that the Board would not have proceeded against him if he had been unsuccessful in his action in tort against the third party. The High Court held that the Boards charge was legally binding on the rating and it was of no consequence that the Board might forgive him the debt if his action in tort failed. 89. In Hardwick v Johnson (1978) 1 WLR 683 a mother who had purchased a home as a residence for her son on the terms that he should pay weekly instalments off the purchase price was held to have intended the agreement to be binding. 90. His Honour Judge Neilson considered the difference between "ordinary commercial transaction" and social or familial agreements in Harris v Cudgegong Soaring Pty Ltd (1995) 11 NSWCCR 678 at 694. He took the view that if the worker asserted there was a contract then the worker had the onus of proving it including the animus contrahendi. 91. The principles I draw from these authorities for application in this case are: 1. The test of intention to enter into legal relations is objective to be determined by outward manifestations not the subjective intent of the parties. 2. There is a presumption at common law that where there is a close familial relationship that agreements between family members are not intended to give rise to a binding legal relationship or be attended by legal consequence. 3. That presumption is rebuttable. Factors that a Court will give weight to in deciding whether or not the agreement was meant to be binding include: (a) a clear intention to be bound (b) the commercial nature of the agreement and (c) the gravity of the detriment to the party seeking to enforce the contract. NECESSARIES 92. Turning next to the law on intention to enter into a legal relationship concerning the provisions of necessaries to mentally disordered persons. 93. This is particularly relevant here as both parties agree that Kim Lloyd because of her mental disorder is not capable of making a valid contract. 94. The common law provides that if necessaries are supplied to an insane person an implied obligation arises to pay for them out of that persons property. This principle does not offer an easy resolution of Mrs Lloyd's claim because Lord Lindley in Re Rhodes at page 107 makes it clear that the obligation does not arise unless it was the intention of the person supplying the necessaries that they should be paid for. He or she must not intend to play the role of benefactor but rather constitute himself or herself as a creditor. 95. Nevertheless Mrs Lloyd is entitled to draw some solace from the remarks of Chief Justice Griffiths in McLaughlin v Freehill (1908) 5 CLR 858 at 863 viz ... the obligation implied against a person under disability is obligatio quasi ex contractu. Here there was prima facie an implied obligation or contract. 96. I draw from those authorities the following propositions: 1. Where necessaries are supplied to a person suffering from a mental disorder there is an implied contract. 2. That implication is rebuttable by proof that the person supplying the service did so as a benefactor and did not intend to be a creditor. 97. Having reviewed that law I should return to Justice Meagher's remarks at paragraph 11 in Manning and the meaning that should be given to them. 98. If paragraph 11 constitutes a statement of legal principle rather than a comment on the state of the evidence then it was entirely out of character. 99. In recent years leading judgments on a judges duty to provide adequate reasons have flowed from the pen of Justice Meagher (eg Beale v GIO (1997) 48 NSWLR 430 at 442). His Honour has set high standards for judges and, to my mind, it is unthinkable that he would establish a legal principle without offering the reader any explanation. 100. To those who might suggest that the law is so trite or well settled that no reasons have to be given I need only refer to the case law I have cited which makes it abundantly clear that while there are legal presumptions that might be drawn from familial relationships it certainly does not go without saying that no contract exists. 101. I take the view that Justice Meagher's remarks simply refer to the total lack of evidence in Manning's Case concerning Mrs Manning's intent to require her husband to pay for her services. At first instance Mr Manning's legal advisers were oblivious to the need to prove a case in contract and not surprisingly led no evidence that could have assisted the Court discern Mrs Manning's intention to bind her husband to pay for her services. 3. Proper Construction S 61 102. Mr Cooley in circumstances where the GIO has paid $100 and then $300 per week for Mrs Lloyd's services as an attendant carer justifies her claim for a much more substantial fee for service on the basis that s 61 is a statutory code which empowers, indeed requires the Compensation Court to review contracts for s 60 services prior to making an award and fix the price of medical and related treatment at a reasonable amount. 103. S 61 provides: 61 (1) The amount for which an employer is liable in respect of the medical or related treatment of a worker is such amount as is reasonably appropriate to the treatment given, having regard to the reasonable necessity for the treatment and the customary charge made in the community for the treatment to persons other than workers. (2) The maximum amount for which an employer is liable for any particular medical or related treatment shall not exceed such sum (if any) as may be fixed by the Authority in respect of that treatment by order published in Gazette. [subs (2) am Act 85 of 1998 s 3 and Sch 1 opn 1 Aug 1998] (3) The maximum amount for which an employer is liable for medical or related treatment given to a worker in respect of the same injury (whether the treatment is given at different stages of the injury or not) is - (a) $50,000; or (b) where some greater amount has been fixed by the Authority by order published in the Gazette - that greater amount. [subs (3) am Act 85 of 1998 s 3 and Sch 1 opn 1 August 1998] (4) Subject to the regulations, a direction may be given that the employer of a worker is liable for an amount additional to that fixed by subsection (3). [subs (4) subst Act 99 of 1991 s 3 and Sch 1 opn 1 Feb 1992; am Act 85 of 1998 s 3 and Sch 1 opn 1 Aug 1998] (4A) If proceedings relating to the worker's claim for compensation are before the provision of medical or related treatment for the worker, such a direction may be given by the Court. If no such proceedings are before the Compensation Court, such a direction may be given by the Authority on application made in respect of the worker from time to time. [subs (4A) insrt Act 99 of 1991 s 3 and Sch 1 opn 1 Feb 1992] (5) The amount for which an employer is liable for the care of a worker as referred to in paragraph (f) of the definition of "medical or related treatment" in section 59 is (subject to any maximum amount under this section) the reasonable cost of providing that care having regard to the extent to which care might be expected to be provided by the worker's spouse or other person residing with the worker. (6) The amount for which an employer is liable for the modifications of a workers home or vehicle as referred to in paragraph (g) of the definition of "medical or related treatment" in section 59 is the reasonable cost of carrying out those modifications. (7) Except as otherwise provided by the regulations, the maximum amount under subsection (3) does not apply to any liability of an employer referred to in subsection (6). (8) Any amount for which an employer is liable under this Division in respect of medical or related treatment may be recovered from the employer by the person who gave the treatment. (9) If the maximum amount referred to in subsection (2) or (3) is, on or after the commencement of the subsection, amended either by an Act or an order of the Authority, the amount for which an employer is liable in respect of the medical or related treatment applicable to the worker at the time when the worker became injured. [subs (9) insrt Act 99 of 1991 s 3 and Sch 2 opn 1 Feb 1992; am Act 85 of 1998 s 3 and Sch 1 opn 1 Aug 1998] A. S 61(1) 104. In Radulovic v Multiweld Engineering Pty Ltd (2000) 20 NSWCCR 598 I considered the proper construction of words and phrases "community", "customary charge" and "persons other than workers". 105. There has been no attempt by the respondent, who bears the onus, to put evidence before the Court concerning what is the workers community or customary charges for attendant care for persons other than workers in the Grafton area. The only evidence before me relates to the charges quoted by Dial an Angel and the evidence of the trade union organiser Ms Gordon as to the appropriate award rates. I am aware that fees for present attendant care are being paid to the new service provider but the Court has not been acquainted with the details of those payments. 106. The respondent argues that it bears no liability in any event because Mrs Lloyd had no intention to enter into a binding agreement with her daughter. If I should find to the contrary I intend to apply the long established approach of this Court where respondents fail to discharge their onus under s 61(1) of deciding whether or not the fees claimed by Mrs Lloyd were reasonably appropriate to the treatment given see Gordon v Commissioner of Railways (1946) WCR 20; Ebert v NSW Department of Education (1991) 14 NSWCCR 628, Elliott v Waringah Shire Council (Unreported 18 June 2000 Neilson J matter no 34023 of 1999). B. S 61(5) 107. This subsection deals specifically with cases of medical or related expenses falling within the ambit of s 59(f). It qualifies s 61(1) entitling the Court to take regard of the extent to which care might be provided by the workers spouse or other person residing with the worker. The only authority I can find touching upon this issue is the decision of His Honour Judge Burke in Bennett v Garry Bennett Holdings Pty Ltd 14 NSWCCR 317 at 327 where he said During short term illness one can expect an enormous degree of care from a spouse but when a problem continues unabated into indefinite future without respite, that is another thing altogether. 108. One would not imagine that it was the NSW Legislatures intention in passing s 61(5) to empower this Court to make awards that would directly or indirectly require spouses or family members to provide any part of their family members medical or related treatment. I take the view that the provision should be construed to mean that the Court should, taking all the circumstances of the case into consideration, reach a conclusion as to whether the spouse or family member was willingly prepared and able to gratuitously provide those services at the relevant time. C. S 61(8) 109. In my judgment of 13 August 1999 I found that Kathleen Lloyd had the right pursuant to the provisions of s 61(8) to claim s 60 expenses against the respondent and that this Court had jurisdiction to hear such a claim. 110. Hall QC's submission, as I understand it, is that s 61(8) does not provide a substantive right of action to the providers of medical and related services to sue employers for the cost of their services. Rather it provides a derivative right of action founded upon proof of a pre-existing s 60 liability between the worker and the service provider. 111. Mr Cooley's submissions here were more difficult for me to understand and I trust I am doing them justice in this summary: 1. In late 1993 the GIO entered into a contract with Kathleen Lloyd for her to supply necessaries in the form of attendant care to her daughter Kim Lloyd. 2. The GIO was at all relevant times a licensed insurer under the Workers Compensation Act 1987 and the insurer of the respondent. S 159(2)(a) the 1987 Act makes the insurer directly liable to any worker insured under the policy of Insurance. S 159(2)(b) subjects the insurer to any judgment or award of this Court made against the respondent employer. In Registrar, Workers Compensation Commission of NSW v National Employers Mutual General Insurance Association Limited 1922 ALR 677 Justice Atkin said at p 699 "I can see no escape from the conclusion that it (ie the scheme of the Act which makes the liability of the insurer to the worker match the liability of employer to the worker) imposed an overriding requirement that the insurer shall be liable wherever the insured employer is liable. 3. It follows therefore that the insurer is not only exercising subrogated rights under the policy of insurance but liable in its own right and the payment to Mrs Lloyd was to meet that direct liability. 4. S 60(1) requires that the employer (and consequently the insurer) is liable to pay a reasonable price for medical and related services. 5. S 61(8) entitles the services provider to make a claim against the employer in respect of the provision of s 60 services to a worker. That claim is a matter arising under the Act within the meaning of s 105 of the 1998 Act and this Court has jurisdiction to deal with such matters. 112. In my earlier judgment I reached the following conclusions: 1. That the jurisdiction powers and functions of the Compensation Court of NSW must be derived from the Workers Compensation Legislation. If the provider of services defined by s 59(f) is to have standing to recover s 60 expenses then that provider will have to establish that the recovery of s 60 expenses by the service provider is a matter arising under the Act. 2. This Court is required in determining its jurisdiction to examine the true nature of the claim to ascertain whether or not it owes its existence to the Workers Compensation Acts or the general law. 113. I agree with Hall QC's arguments on this point. If the true nature of any claim in contract between the GIO and Mrs Lloyd is a matter arising outside the Workers Compensation Act 1987 then this Court has no jurisdiction because it cannot determine contracts under the general law. Before such a contract for services can be proved to fall within the provisions of the Act the claimant must establish each and every requirement of s 60 including the requirements in Manning of a binding legal agreement between the service provider and the worker. If these elements are not proved then, in my opinion, this Court has no jurisdiction. 4. ESTOPPEL 114. It is Mr Cooley's submission that this Court should find that the respondent is estopped by its conduct from denying either: (a) a binding contract exists between Mrs Lloyd and Kim to provide s 59(f) services or (b) the payments made by the GIO to her were not a properly incurred s 60 expense arising from such a contractual relationship 115. In a case where there is a plethora of submissions going to the Courts jurisdiction to hear Mrs Lloyd's claim no such submission has been raised in respect of the Courts powers to apply the law of estoppel. In Somodaj v Australian Iron & Steel Ltd (1963) 109 CLR 286 the High Court permitted the application of estoppels by judgment in the Compensation Court of NSW. Since that time judges of this Court have regularly applied the full range of estoppels to cases before them. 116. Hall QC does not concede, however, that this Court has jurisdiction to apply the law of estoppel be it common law or equitable in nature concerning any contractual relationship between the GIO and Mrs Lloyd. 117. There is a significant body of law on the nature and effect of estoppels in Australia which is reviewed in Waltons Store (Interstate) Limited v Maher & Anor (1987 - 1988) 164 CLR 387, Grundt v Great Boulder Pty Gold Mines Ltd (1937) 59 CLR 675. 118. Equitable estoppels apply to compel adherence to an assumption of rights. In other words what Mr Cooley is suggesting is an estoppel in pais which he would seek to establish by the following steps: (i) Mrs Lloyd enjoys rights under s 61(8) to claim s 60 expenses from the employer. (ii) S 159(2)(a) of the 1987 Act imposes equally liability on the GIO with the respondent. (iii) Mrs Lloyd was entitled to assume from the GIO's actions in paying her a carers allowance that the legal relationship that existed between the GIO and herself was that of a s 59(f) service provider to her daughter and that it was discharging its statutory obligations to meet her daughters s 60 expenses. (iv) The GIO by its representations induced Mrs Lloyd to adhere to the assumption that she was entitled to be paid as a service provider under the Act and that her daughter was entitled to claim for her services under s 60. (v) Mrs Lloyd then acted in reliance of that expectation continuing to provide those services between 28 October 1993 and 13 October 1998. (vi) The GIO knew that Mrs Lloyd continued to provided those services and encouraged her to do so. (vii) Mrs Lloyd suffered great personal detriment by adhering to her assumption. (viii) The GIO failed to act to avoid that detriment. (ix) The respondent should therefore be estopped from asserting a different state of affairs concerning Mrs Lloyd's rights namely that she has no rights because of the absence of a binding contract between her and her mentally disordered daughter. 119. Hall QC's submission concerning the estoppel issue is that no estoppel can operate to create an entitlement to pay Mrs Lloyd under the Workers Compensation Act where no such right exists in law. A similar argument was put for the appellant by Gyles QC in the Walton's Stores case who argued there could be no promissory estoppel because Mr Maher was under the mistaken assumption that there was a binding agreement between the parties. Gyles QC's argument was that Mr Maher was asking the Court to drive promissory estoppel beyond traditional orthodoxy by enforcing directly in the absence of a pre-existing relationship of any kind a non contractual promise on which the representee had acted to his detriment. Nevertheless that is precisely what the High Court did. Because equitable estoppel had its basis in unconscionable conduct, rather than the making good of representations it took the view that holding the representor to his representation was merely one way of doing justice between the parties. Accordingly Chief Justice Mason at p 406 said: The foregoing review of the doctrine of promissory estoppel indicates that the doctrine extends to the enforcement of voluntary promises on the footing that a departure from the basic assumptions underlying the transaction between the parties must be unconscionable. RESOLVING THE ISSUES 1. INJURY 120. The respondent admits that the worker has arising out of and in the course of her employment sustained the injuries of which she complains. 121. The respondent has not in so many words conceded that the applicant has sustained a psychological injury within the meaning of the Act. However it has in its submissions put in issue the applicants mental capacity to contract and admitted total and permanent incapacity for all work. 122. Because this issue is not pressed I do not propose to deal in any detail with the comprehensive medical evidence dealing with Kim's brain damage. All the eminent neurosurgeons psychiatrists psychologists and rehabilitation consultants confirm that she has sustained extremely severe brain damage. Dr Buckley assessed the damage at 90 per cent of a most extreme case. 123. Because the extreme nature of the brain trauma was self evident and because there was no issue as to the workers profound cognitive dysfunction the medical evidence is not particularly concerned with the extent to which Kim's psyche has been damaged. However Dr Buckley and others note here impulsive and disinhibited behaviour, inappropriate behaviour, poor insight, underestimation of her disability, inability to plan, terrible memory, short attention span, lack of understanding about money and general vulnerability. There is no evidence to the contrary. 124. Taking all the evidence into consideration I determine that on the balance of probabilities that the applicant has sustained a psychological injury within the meaning of the Act. 2. MENTAL DISORDER 125. It is a requirement in this case that the Court find the applicant has a mental disorder sufficient to invoke the common law of necessaries. 126. The common law is couched in archaic and somewhat offensive language requiring the court to find Kim Lloyd to be a "lunatic". By the turn of the 20th Century Australian Courts were substituting the word "insane" which in today's language is no less pejorative. 127. These days in NSW such matters are no longer within the jurisdiction of the Master in Lunacy but the Guardianship Board pursuant to the provisions of the Protected Estates Act 1983. The Guardianship Board sits as an expert tribunal to decide whether individuals are capable of managing their own affairs. The definition of a person incapable of managing his or her own affairs is not drawn from the Act but from the common law. 128. The recognised way of resolving the issue was formulated by Justice Powell in Py v RJS & Ors (1982) 2 NSWLR 700 at 702 where he stated that a person is not shown to be incapable of managing his or her own affairs unless: (a) he or she appears incapable of dealing in a reasonably competent fashion with the ordinary routine affairs of man; and (b) that by reason of that lack of competence is shown to be at real risk that either: (i) he or she may be disadvantaged in the conduct of such affairs or (ii) that such monies or property which he or she shall possess may be dissipated or lost. It is not sufficient merely to demonstrate that the person lacks the higher level of ability needed to deal with complicated transactions or that he or she does not deal with even simple or routine transactions in the most efficient manner. 129. The Guardianship Board of NSW on 26 June 1996 found the worker was not capable of managing her own affairs and committed the management of her affairs to the Protective Commissioner. 130. On the evidence before me I can only agree with that expert tribunals determination. 131. Accordingly I determine that the applicant is a mentally disordered person to whom the law of necessaries would apply. 3. NECESSARIES 132. The question is whether the attendant care provided by the workers mother constitutes necessaries. Health care has traditionally been considered a necessity. Given the evidence of Professor Oakeshott and Dr Buckley concerning the workers vulnerability as well as the evidence of Kathleen Lloyd and the workers sisters and friends concerning the nature and extent of her vulnerability and the risks posed to her well being I have no difficulty in determining on the balance of probabilities that the care that was provided by Kathleen Lloyd to her daughter constitutes necessaries. 4. S 60 CRITERIA 133. Before I address the critical issue of Mrs Lloyd's animus contrahendi I should first apply Judge Burkes criteria to determine whether or not the attendant care provided by Mrs Lloyd to the worker was "reasonably necessary". (a) Does it fall within s 59(f)? 134. The nature of the care provided by Mrs Lloyd is described in the report of Dial an Angel dated 27 February 1996 as: · Constant supervisory care and companionship · Motivation, prompting and direction in all daily activities · Financial guidance and assistance with budgeting · Personal care - ie assistance with bathing and drying, dressing and undressing, toiletting, grooming (hair washing, nail clipping, teeth cleaning etc) tray service of meals, assistance with transfers to and from bed, chair, in and out of motor vehicles, the monitoring and administering of prescribed medications, night time attendances, assistance with therapies and exercises, personal shopping, letter writing etc · House keeping - assistance with laundry (washing and ironing) changes of bed linen, bed making, general maintenance and cleaning of home, attention to hot plates, oven and refrigerator/freezer, the preparation, cooking and cutting up and service of meals and shopping · Driving and accompanying to activities remote from home · Handyman, gardener services 135. I have already noted that because the services provided by Mrs Lloyd were not in a medical setting that they are not nursing services as defined by s 59(e). 136. It is not in dispute that those services were under the direction and supervision of Kim Lloyd's medical and rehabilitation advisers notably Dr Palmer and the Lismore Rehabilitation Service who having regard for Kim Lloyd's incapacity advised Mrs Lloyd in her delivery of those services. They were also carried out at the direction of Professor Oakeshott. 137. Accordingly I take the view that the worker has established a prima facie case that generally speaking the care provided was relevant medical treatment. I propose to deal at a later stage with the question of whether or not the cost of the services should include handyman and gardening services as well as some of the housekeeping services. (b) Has that presumption been rebutted? 138. The respondent has not sought to rebut that presumption in its submissions. (c) Does the necessity for the treatment result from the injury? 139. The applicants medical evidence which goes uncontradicted is that this is the case (see Professor Oakeshott's report 15 May 1997 page 6 para 1(a) where he makes it clear that the purpose of the treatment is to alleviate the consequence of the injury.) (d) Is the treatment essential? 140. Professor Oakeshott at page 6 of his report asserts She requires attendant care for 24 hours per day, seven days per week for the rest of her life. This person would be responsible for: · meal preparation/shopping · planning and structuring her day · washing and ironing her clothes · general housekeeping · her safety/security. Her impetuous behaviour makes her very vulnerable at all times · her daily financial matters · transport (driving This person need not be a trained health professional. 141. On the balance of probabilities I find that the treatment is essential. (e) Should it be afforded? 142. The respondent has at various stages of the proceedings proferred differing views about the costs and extent of treatment. For example it made an open offer of settlement based on 12 hours per day care. Ultimately on 13 October 1998 it consented to an award for an independent carer to provide future care on a 24 hour per day basis. 143. Recently the respondent has approached the Court to review that consent award. However the respondent has brought no evidence in this case to rebut the evidence as to the cost of care presented by the worker and by Mrs Lloyd. There is no proposal for alternative or more effective treatment before the Court in this case. 144. Accordingly taking all the evidence into consideration I determine on the balance of probabilities that the treatment claimed by the applicant and Mrs Lloyd is reasonably necessary in that it is essential to, should be afforded to and should not be forborne by the worker. I propose to address the question of the appropriate cost for the services only if I find that the principles in Mannings Case have been established. MRS LLOYD'S INTENTION TO BIND HER DAUGHTER Admissibility of Evidence 145. On reading the submissions it is clear that in the determination of both claims all roads lead to the core question of whether or not Kathleen Lloyd intended that Kim Lloyd be held liable for the costs of her services. A great deal of evidence has been taken orally and tendered in documentary form that goes to Mrs Lloyd's relationship with the GIO at Lismore and Newcastle. I took that evidence on a provisional basis subject to Branson QC's and later Hall QC's objections that it was not relevant because: (a) nothing the GIO did could constitute consideration binding the worker. (b) It was outside this Court's jurisdiction to determine the existence of an employment relationship between Mrs Lloyd and the GIO. (c) It is outside this Court's jurisdiction to determine the nature of or enforce a contract between an insurer and an alleged service provider. (d) Any admissions or conduct arising under mistake of law by employees of the GIO are not binding upon the respondent. 146. I dealt with the relevant case law concerning the jurisdiction of this Court in my earlier judgment on s 61(8). I have summarised those findings earlier in of this judgment. My conclusion is that because the powers of the Court derive solely from the Workers Compensation Legislation this Court will only have jurisdiction if on examining the true nature of the claim it is apparent that it owes existence to the Workers Compensation Acts and not the general law. Accordingly because s 61(8) is demonstrably a right which owes its existence to the 1987 Act Mrs Lloyd was entitled to bring her claim. 147. However I agree with Hall QC when he characterises s 61(8) as a derivative right which can only be exercised if the substantive right of the worker to claim the s 60 expenses against the respondent has first been established. 148. I have read Mr Cooley's submissions relating to the alternate claims by Mrs Lloyd against the GIO based on alleged contractual relationships of various types. 149. Those claims can be characterised as actions in contract or quasi contract and do not owe their existence to the Workers Compensation Legislation. Accordingly I agree with Hall QC's submissions that this Court lacks the jurisdiction to hear them. 150. In so far as the evidence tendered in this case relates exclusively to such claims then clearly it is inadmissible. 151. However where the evidence either directly or inferentially would assist this Court determine the crucial issue of Mrs Lloyd's intention to bind her daughter to pay for her services then that is evidence that goes directly to the substantive claim under s 60 and the derivative claim under s 61(8) and on that basis is admissible. 152. There are many hundreds of pages of exhibits and transcript covered by the respondents objections. I have read it all but only propose to refer to and rely upon those documents and that evidence relevant to the determination of the intention issue. SUMMARY OF ARGUMENTS The Respondent 1. The court ought to infer that Mrs Lloyd commenced to provide care to her daughter from October 1993 solely because she was her daughter. 2. There is no basis for concluding Mrs Lloyd expected or required payment from her daughter. 3. Kim Lloyd was unable and never intended to enter into a contract nor did anyone do so on her behalf. 4. The account prepared after Manning's case in 1998 is an artifice without legal meaning because there never was a genuine "cost" to the worker. 5. The basis of the payments made by the GIO to Mrs Lloyd was for the services of third parties not to pay Mrs Lloyd for her services. Mrs Lloyd 153. Mrs Lloyd's intention to be paid for her services to her daughter is established by: 1. The respondents insurer who bears equal liability with the respondent, payment to her of a carers allowance. 2. Admissions on the files of the GIO Lismore that the insurer agreed to Mrs Lloyd's request to pay her as Kim's attendant carer. 3. Evidence in the files of the GIO Lismore that Mrs Lloyd was dissatisfied with the quantum of her carers allowance and asked for it to be increased. 4. Admissions in the files of the GIO Lismore concerning the payment of the $300 carers allowances to Mrs Lloyd because she was having financial problems. 5. Admissions in the files that medical advisers employed by the GIO recommended that the carers allowance be increased. 6. Evidence by Mrs Lloyd that she always intended to be paid for her services. 7. Evidence from Mrs Lloyd and correspondence between McLellands and McCabes Solicitors that Mrs Lloyd was dissatisfied with the quantum of her carers allowance. 8. Evidence that Mrs Lloyd in her capacity as her daughters legal personal representative instructed McLellands to take proceedings on her daughters behalf for the payment to Mrs Lloyd of a carers allowance under s 60. Evidence that such proceedings were instituted. 9. Evidence that McLellands Solicitors submitted financial particulars of Mrs Lloyd's claim to the respondents solicitors for indemnification. 10. Evidence that Mrs Lloyd submitted day by day bills for her services to McCabes Solicitors from October 1997 and was indemnified by the continued payment of the $300 carers allowance. 11. Evidence that on the appointment of the Protective Commissioner to manage Kim's affairs McLellands Solicitors made the Commissioner aware of her claim for the carers allowance. A. THE COMPETING LEGAL PRESUMPTIONS 154. Mr Cooley correctly submits that because Kim Lloyd suffers from a mental disability and because Mrs Lloyd's services are necessaries then the common law implies a prima facie contract. He goes on to submit that the respondent has failed to discharge its onus to rebut that implication of law. 155. Hall QC on the other hand correctly submits that such an implied contract can be rebutted by proof that the service provider acted as a benefactor not a creditor. He then would, in effect, shift the onus back to Mrs Lloyd by relying upon the common law presumption that agreements between family members are not intended to give rise to a binding legal relationship. Mr Cooley points out that that presumption itself is rebuttable. 156. What is clear to me from this evidentiary ping pong is that this case cannot be decided by merely relying upon presumptions and that in the end this Court must weigh all the evidence and using an objective test decide on the balance of probabilities whether or not Mrs Lloyd intended to bind her daughter to pay for her services. B. WAS THERE A CLEAR INTENTION TO BE BOUND? 157. Mrs Lloyd, was not entering into a contract in the normal sense with her daughter whose mental disability precluded the usual process of negotiations that leads to a bargain. The only element of a contract required in necessaries cases is an intention on the part of the service provider to create legal relations. 158. Because the Court is making a determination about animus contrahendi Mrs Lloyd's testimony can be useful. However it is the outward manifestations of that intention to be drawn from the subject matter of the contract, the nature of the agreement and other circumstances that will be determinative. (i) Mrs Lloyd's Direct Evidence 159. Mrs Lloyd gave evidence on five occasions namely 29 September 1998, 30 September 1998, 17 August 1999, 20 December 1999 and 21 December 1999. Mrs Lloyd also provided two written statements to the Court dated 5 June 1998 and 5 January 1998. 160. It is clear from Mrs Lloyd's evidence that she had no clear recollection of discussions she had with officers of the GIO but she did her best to give the gist of those conversations. I have allowed that evidence not because it went to any bargain with the GIO but because I believe that it was relevant to the state of her mind on the question of being paid for her services to Kim. 161. Branson QC in his cross examination of Mrs Lloyd never put to her the proposition that she had no intention to require Kim to pay her for her services. 162. Hall QC did address the matter however. At page 17.6 of T 20.12.99 the following exchange took place: Q. In relation to this initial conversation about allowance your intention firstly was to ensure that in the case of asking others to come in to relieve you if you had to go out you would be in a position to pay the for their efforts? A. No Because my kids never, ever wanted money for looking after their sister. Q. But that was certainly one purpose you had in mind in so far as there was somebody to come into the house when you were not there looking after Kim.... that you would have a means of finance to pay them if and when you wanted somebody to come to replace you when you had to go out? A. No. I believe that the money was for me looking after Kim. I had looked after her for 24 hours for nothing so I believed it was for myself. 163. Hall QC returned to the matter at page 29.1 T 20.12.99 as follows: Q. As her mother you never intended to charge Kim herself did you? A. Kim was an adult, grown adult and she should have had care and I don't think it comes under a mother act that she has to do it. Q. You have never for example never charged Kim herself, I am leaving aside others for the moment, nor intended to your daughter did you? A. If there was a place there to do it yes I would of because it is not my place, not legally my place to have to do it when she was hurt and covered by insurance. 164. Then at page 31.5 Q. ......you never rendered an account to Kim for example... that is true is it not. A. It was a possibility but I never done it no. Q. Nor had you ever intended before September 1998 to do so, that correct is it not? A. No. Q. Sorry is that true? A. The thought was there that I may have to recover costs from Kim or from the GIO or. Q. You never contemplated charging your daughter fro your services did you? A. I had never done it but the thought was there. Q. You had never intended to do so - to charge Kim for your services is that not correct Mrs Lloyd. A. If I had to do something I would have had to charge it. If I had to get help in the money would have to come from somewhere. The GIO wouldn't have paid it so it would have to go to Kim. Q. You paused before you answered that question. What I am putting to you is and I will put it to you in these terms, I am not talking about getting others to do the work for Kim I am putting to you - I did not think there was any doubt about it but I put it to you - you never intended to charge Kim for your services to her as your daughter did you never ever. A. I don't suppose so - the thought was there that it could be done. 165. Mrs Lloyd was not the best at comprehending questions from lawyers and the last question was so lengthy and convoluted that after reading it I am left confused, particularly by what was meant by "services to her as your daughter". 166. Mrs Lloyd had over the many previous but more concisely structured questions resolutely maintained that at her request the GIO was paying her allowance from her daughters entitlements but that she would have charged her daughter even had the GIO not met bills that had to be paid. Indeed her final remarks confirms that was the position. 167. I found Mrs Lloyd to be a genuine country Australian. She may not have had much of an understanding of the law or lawyers questions and her memory for details of conversations was not terribly good but her honesty and sincerity shone through her evidence. I found her to be a witness of truth and believed her when she said it was her intention that she be paid for the services provided for her daughter. However the test is objective not subjective and mere proof of her subjective intention will not suffice. (ii) What conclusion can be drawn from Mrs Lloyd's personal circumstances? 168. Both parties have suggested that the Court should draw inferences from the circumstances underpinning Mrs Lloyd's decision to provide 24 hour care to Kim that would go to her intention to assume the role of benefactress or creditor. Predictably the parties would have me draw opposite conclusions. 169. A recital of those circumstance is appropriate. Mrs Lloyd's evidence and statements reveal: 1. Kim injured on 17 January 1993 was flown to the Royal North Shore Hospital in a coma. 2. Mrs Lloyd gave up her full time job as a cook the same day and travelled to Sydney to be at Kim's side. With the exception of a week off to attend to the needs of another injured daughter in Brisbane Mrs Lloyd visited her daughter daily. 3. Kim was in a comatose state for 16 weeks but Mrs Lloyd talked to her, showed her photographs and played videos and music to help revive her. 4. When Kim revived at the Royal Rehabilitation Centre Ryde Mrs Lloyd pushed her wheelchair, assisted with physiotherapy and speech therapy and took her on outings to family members in Sydney despite her lack of cognition and incontinence. 5. When Kim was transferred to Lismore Mrs Lloyd returned to Half Way Creek and resumed work two nights a week. She attended St Vincent's Hospital Lismore on 3 days a week. The hospital was 150 kms from her home. During those visits she became involved in Kim's rehabilitation attending classes in physiotherapy, speech therapy and occupational therapy. She took Kim on outings. 6. About July 1993 Mrs Lloyd started taking Kim home on weekends. This was not easy because of Kim's inability to walk without support, her incontinence and uncontrollable violent behaviour when she knew she had to return to the hospital. 7. On 28 October 1993 Mrs Lloyd took Kim home to Half Way Creek a country property with a number of homes on it. Mrs Lloyd and Kim lived in a 4 bedroom home and Kim's sister Marion and her family lived nearby. 8. Mrs Lloyd was well aware that Kim required 24 hour care when she took her home. Mrs Lloyd graphically described her personal circumstances at page 14.2 T 30.9.98 as Well I had seven other children, 14 grand children which I'd like to become a mother to again, plus Kim and I have an 81 year old mother an epileptic. 170. She added that her health "was not real good". Mrs Lloyd was 53 years of age in 1993 and a widow although her daughter Marion indicated she had been in a relationship for some years but did not live with the gentleman. Marion described how her mother put on weight after Kim's accident, developed a thyroid problem, resumed smoking and regularly broke down from the stress. She was also in straightened financial circumstances. 171. Hall QC submits that in those circumstances the Court ought to infer that Mrs Lloyd commenced to provide care to her daughter from October 1993 solely because she was her daughter and there was no basis for concluding that she expected or required payment from her daughter. 172. It is fair to say that it is evident from the evidence that Mrs Lloyd would not have been providing 24 hour care to somebody who was not a close family member. She was a cook not an attendant carer and it is obvious from her evidence that she would have much rather have continued in her job and enjoyed the role of grandmother to her large family, supported her epileptic mother and continued a social life involving line dancing, tennis and visits to clubs. 173. I accept Hall QC's first proposition. The next question is whether the circumstances I have described inevitably lead to his second proposition that there is no basis for concluding that Mrs Lloyd expected or required payment from her daughter. 174. From the evidence, the following matters emerge to be weighed by the Court. (a) The extremely demanding nature of the task 175. Dial an Angel in their report of 27 February 1996 describes Kim's ongoing disabilities and handicaps at page 2 and 3 and assesses the duties involved in meeting her needs at page 5. It is exhausting to read about the task let alone imagine performing it. Dr Buckley's reports in early 1994 emphasise how difficult Kim was on the first year out of hospital. 176. This was a task that Dial an Angel recommended should be carried out by a team of carers and handymen not a lone 53 woman with occasional back up from two daughters or a friend. 177. The extremely daunting nature of the task particularly the fact that it was an unremitting 24 hour a day job with a subject suffering severe mental and physical disabilities who was incontinent and prone to dangerous and sometimes violent behaviour would lead any rational person to think long and hard before volunteering for it. It was not as if Mrs Lloyd did not know what she was getting into. She had a full appreciation from caring for Kim in Sydney and on weekend leave of what was involved. 178. It would not be surprising to me that even a close family member would be likely to demand financial compensation for shouldering such an onerous burden. (b) Mrs Lloyd's Financial Problems 179. Mrs Lloyd was on a carers benefit totalling $175 per week. She supplemented that with two nights work as a cook for about $200 until she lost that job. The financial demands associated with caring for Kim were heavy, particularly car maintenance and fuel associated with regularly ferrying her long distances to Lismore and Grafton for various forms of therapy, education and medical treatment as well as feeding and clothing her. She also had to maintain her country property and feed and cloth herself. It would not be surprising that a woman in those financial straits might look to her injured daughters resources to pay for the care particularly when her daughters welfare was dependent upon the quality of care she received. (c) There were no volunteers 180. Hall QC suggests that because no one else was prepared to care for Kim including her sisters and defacto partner them Mrs Lloyd had no alternative but to become a voluntary carer. 181. That submission reflects badly on the GIO who having admitted liability and paid the hospitals, doctors and physiotherapists neglected to advise Mrs Lloyd an isolated country woman with no legal adviser of her daughters rights under s 60 as defined by s 59(e) and s 59(f) to receive care from someone like Dial an Angel. 182. It follows that if no one else was prepared to care for Kim then her mother might do so. It does not follow that because no other person was prepared to assist that Mrs Lloyd had no intention of being paid for her services. (d) Mrs Lloyd's Past Voluntary Service to Kim 183. The Protective Commissioners claim commences with Mrs Lloyd caring for Kim in Sydney. 184. Mrs Lloyd's claim also commences from the date of injury including care provided when Kim was in a coma and during her rehabilitation at Ryde and St Vincent's Lismore. Mr Cooley ultimately pressed no arguments that his client should be paid for the previous 10 months she spent in Sydney and Lismore providing care to Kim. 185. The obvious difference was that until 28 October 1993 the care, though regular, was for only a few hours a day and some weekends. Afterwards the care was constant 24 hours a day 7 days a week for five years. 186. My colleague His Honour Judge Burke considered this question of just how much care might be expected by society of family members in such situations in Bennett v Gary Bennett Holdings Pty Ltd (1997) 14 NSWCCR 317 at p 327 G when he pondered the meaning of s 61(5). This was a case involving 24 hour care of a severely brain damaged husband. Judge Burke held that during short term illness, a high degree of care from a spouse might be expected but when a problem continues unabated into the indefinite future without respite, it is otherwise, especially when, as in that case, the spouse was also running a lucrative business - a full time job in itself with demands. 187. While it is obvious that Judge Burke's approach to s 60 finds little favour in the Court of Appeal commonsense suggests that after 10 months of looking after Kim, a severely injured but adult daughter, sacrificing her job, her social life, her personal relationships and her health a 53 year old grandmother with 8 children, 14 grandchildren and an epileptic 81 year old mother might well have reached the point where society no longer expected such voluntary care. Unlike Mrs Bennet, Mrs Lloyd did not have a lucrative business and was in necessitous circumstances. 188. It is in the nature of women to be maternal and caring to their children and the common law with its sexist bias expects much of them. I could not help forming the impression from Hall QC's cross examination of Mrs Lloyd and submissions that it was his clients contention that a mothers duty is to relieve Insurers of their statutory obligations by providing 24 hour voluntary care to injured adult daughters who had left home simply because a mothers commitment like true love springs eternal no matter how onerous the labour. Well, that is not the position in workers compensation law where the Parliament has recognised in s 61(5) that there are limitations upon what can be expected from relatives. 189. To my mind the totality of the personal circumstances that Mrs Lloyd found herself in were such that her assertion that her intention was to be paid for her services has a powerful credibility. (iii) Conclusions that might be drawn from the conduct of Mrs Lloyd in her relationship with the GIO (a) The $100 Allowance 190. Many days of the Courts time was spent litigating the question of whether the $100 allowance paid by the GIO to Mrs Lloyd was for her services or merely a payment to her so that she might pay third parties to care for Kim while she played tennis. The resolution of that question is relevant to the issue of Mrs Lloyd's intention to bind her daughter for her personal services because if the allowance was in fact paid for Mrs Lloyd's services as Kim's attendant carer then a strong inference can be drawn that she intended Kim to pay. 191. It is clear from the evidence that the relationship between the officers of the GIO and Mrs Lloyd was not on an equal footing. Mrs Lloyd initially had a poor understanding as to her daughters legal rights and it wasn't until early 1995 that the GIO suggested she take legal advice. 192. My impression from listening to Mrs Lloyd's evidence and that of the GIO officers was that the relationship between Mrs Lloyd and the GIO involved Mrs Lloyd firstly complaining about her needs in caring for Kim to either the GIO claims officer or paramedicals such as Julie Wilson from Work Directions Australia. The GIO officers then discussed the matter internally without further reference or any process of negotiation with Mrs Lloyd and eventually, if they deemed it appropriate, communicated their decision to her. 193. Mrs Lloyd has no real recollection of the details of conversations that led to the GIO paying her on 23 November 1993 $100 carers allowance retrospective to 28 October 1993. At page 23 T 17.8.99 she indicated that she might have first raised the matter when she visited the GIO Lismore Office on 28 October 1993 to discuss payment for a "rocker" knife to assist Kim eat her food. 194. Brenda Morrow, the Lismore Claims Supervisor states at p 62.6 that it was a telephone conversation from Mrs Lloyd that first triggered her inquiry about the $100. 195. There are notations in the hand of Brenda Morrow in the GIO Lismore file that go to this issue. The notations are divided by a line suggesting they were separate entries. The first is not dated but says: Mrs Lloyd. Weekly commitments. Tennis - 1 night 6 + 11.30. Who pays for carer? 196. The second is dated 3 November 1993 and reads: Spoke to Dr Christie. Full time companion not full time carer. 60 to 70% of full carers amount would be maximum. 197. The next notation in the file by Brenda Morrow is also dated 3 November 1993 and is a memo to her superior the claims supervisor Wendy Klaus which reads: File referred to you comment on carers allowance. Mrs Lloyd (wkr mum) has asked will we pay for someone to look after Kim when she has to go out. Spoke with Dr Christie. He advised that Kim does need a constant companion but not a full time carer. Suggest we offer Mrs Lloyd a weekly figure and if she wants to pay someone else out of this she can. Referred for your comments. 198. Wendy Klaus then responded on 4 November 1993 in the following terms to her superior and claims manager Sam Simiara; I recommend we offer her $100 pw. This is probably more than she wants but I feel it is a reasonable carers allowance. She can do with it what she wants (to pay someone else). 199. Mr Simiana responded on 9 November 1993. Agreed at $100 pw - it would cost more for a nurse etc. 200. I have not been able to find in searching the file documents produced by the GIO any notation about Mrs Lloyd's conference with a GIO officer about the rocker knife on 28 October 1993. Nor is there any notation of Brenda Morrow's discussion with Mrs Lloyd about the carers allowance. One would have thought that such a financially significant call would have been deserving of a file note. 201. Mrs Lloyd has no clear recollection of precisely what was said during these discussions. The respondents position is that those discussions were not about a carers allowance for Mrs Lloyd at all - Rather they were about allowances for third parties to care for Kim while Mrs Lloyd was playing tennis. Mrs Lloyd's response to this suggestion at T 20.12.99 at p 18.3 was As far as I knew the money was paid to me for looking after Kim. 202. and again at 17.9 No. I believe that the money was for me for looking after Kim. I had looked after her for 24 hours for nothing so I believe it was for myself. 203. Mr Hall put to Mrs Lloyd that in September 1994 she had discussions with Julie Wilson of Work Directions Australia in which she indicated that the $100 allowance was no longer sufficient because of the amount of supervision required for Kim when she was working casually at the Service Station. Mrs Lloyd responded at T 20.12.99 at page 19.7. No, never. I mean my kids looked after Kim I didn't have to pay anyone. 204. I found Mrs Lloyd to be a truthful witness. On the other hand the respondents witnesses evidence both verbal and documentary was inconsistent and ambiguous. I was also concerned at the gaps in the GIO's records on this matter. 205. Mrs Morrow's note of 3 November is ambiguous. On the one hand it suggests that what she was dealing with was a respite carers allowance for tennis nights. On the other that is not the question she put to Dr Christie who discussed a "full time carers" allowance with her. 206. Mrs Morrow's final submission was to give Mrs Lloyd a carers allowance and allow her to pay for respite care herself. Mrs Klaus had no doubts in her note that what Mrs Lloyd wanted was a carers allowance for herself. Mr Simiana was happy enough to approve the $100 because it would have cost much more for a nurse. 207. The allowance was paid to Mrs Lloyd and entitled a "carers allowance". There was no stipulation in the GIO's communications with Mrs Lloyd that it was to be paid to third parties. 208. Taking all this evidence into consideration I determine on the balance of probabilities that Mrs Lloyd asked Ms Morrow for a carers allowance for herself. 209. I draw from the fact that Mrs Lloyd asked the respondents insurer for a carers allowance the inference that she intended to be paid for her services to Kim. (b) The $300 Allowance 210. The GIO increased Mrs Lloyd's carers allowance to $300 on 8 December 1994 back dated to 21 October 1994. 211. Mrs Lloyd recollection of the specific discussion with the GIO that led to the payment of the $300 is vague and somewhat intermingled with a subsequent conversation about Kim's weekly benefits entitlement. 212. However the GIO file has an entry on 9 August 1994 which gives us some assistance. The note was that of the claims officer Karen Herne who records: Carers allowance - will ask Dr Christie for opinion when he sees Kim in October. Mrs Lloyd is having financial problems. 213. It seems clear enough therefore that in some manner Mrs Lloyd had communicated to Karen Herne that she was in financial difficulties and needed an increase in her allowance. It is also clear that contrary to the respondents submissions that the allowance was about payment of respite carers Karen Herne had Dr Christie the GIO's specialist examining Kim in October 1994 to give an opinion about a carers allowance. Moreover Wendy Klaus' notes indicate that Dr Christies brief was to decide whether the allowance was reasonable. 214. The letter of instructions and fax to Dr Christie asked him for an opinion as to whether Kim still needed 24 hour supervision and whether the $100 carers allowance need reviewing. A further file note on 15 September 1994 indicates Mrs Lloyd rang again concerned about her financial problems. 215. Karen Herne then notes that Dr Christie had advised her an industrial award for full time carers was in the pipeline. She recommended a payment of $300 and that was approved on 12 December. 216. A letter from Karen Herne to Dr Christie dated 21 September reads as follows: When you examine Bronwyn I would appreciate if you could comment on the following: 1. We are presently paying Mrs Lloyd $100 per week carers allowance. Is this reasonable? (see attached rehabilitation report dated 2 August 1994 page 5) Does it need reviewing? 2. Does Bronwyn still require 24 hour supervision? 3. Mrs Lloyd has found herself in a financial bind and I was wondering if you can do a s 66 assessment which may enable us to give them some sort of financial relief. 217. Again this pressure on the GIO to increase her allowance raises the inference that Mrs Lloyd intended to be paid for her services to Kim. (c) The Events in 1995 218. Mrs Lloyd's evidence is that she was not satisfied with the $300 allowance or Kim's weekly benefits. She recounts at T 17.8.99 p 28.8 that she had a discussion with a GIO officer early in 1995 about the adequacy of the allowance the benefits and was told it would be reviewed when Kim turned 21 (ie on 26 March 1995). 219. Karen Hernes diary note of 17 February 1995 records Mrs Lloyd telephoning her about an increase in Kim's compensation. It also records Sam Simiana advising that the case was complex needing legal advice and to make no decision until a formal request from Kim's legal representatives was received. 220. Mrs Lloyd's evidence T 17.8.99 at p 29.2 was that when Kim turned 21 and the allowance had not been increased she was back on the telephone. She said she was told to see a solicitor. She then sought legal advice from McLellands. Wendy Klaus notes on 6 April 1995 that Mr Ryan of McLellands called her about the carers allowance. 221. On 21 September 1995 McLellands served the GIO with a copy of an application for determination which inter alia claimed for The cost of care in respect of the period from 17 January 1993 to date and continuing such care being required due to the nature of the applicants brain injury, her physical restrictions and the need for constant supervision. A claim is made on the basis the applicant is completely dependent and requires 24 hours a day care and supervision such claim is made pursuant to s 59 and s 60. 222. Again I draw from these events the inference that Mrs Lloyd intended to be paid for caring for Kim. (d) Further Dealings with McCabe Brown Solicitors 223. On 4 January 1996 McCabe Brown wrote to McLellands seeking further particularly of the application for determination. 224. Paragraph 3 of that letter asked "Itemise all s 60 expenses claimed". McLellands reported on 5 June 1996 on a page 2 stated The Applicants contention is that the care allowance paid to date has been paid at a rate less than the reasonable cost of providing that care having regard to the extent to which her mother would have provided care had she not been injured. The applicant will assert that her mother would not have been required to provide any care services to her having regard to her age at the date of injury and that all care provided is entirely referable to the severe disabilities sustained by her. In so far as the reasonable costs referred to in the Application for Determination is concerned we consider such costs should be quantified upon the commercial rates that would normally be payable for such care. In this regard as evidence in support of the claim the applicant will rely upon the report of Dial an Angel dated 27 February 1996 a copy of which is annexed hereto. You will observe at page 7 of the report the amounts for a live in housekeeper/attendant carer acting on a long term permanent basis at call 24 hours a day 5 days a week are stated as follows: 1994 $950 gross per week 1995 $1,000 gross per week 1996 $1,000 gross per week In addition in respect of weekend care, the value of services have been expressed on a gross rate at between $230 per day in respect of 1994/5 period and $250 per day from 1996. The applicants claim for primary care at the rates referred to and in addition would assert that in assessing the cost of commercial care additional care should be referred to in accordance with the opinion of Ms Blackman on page 9 of her report. The additional cost claimed we consider should be the sum of $480 per week. 225. On 24 June 1997 McCabe Brown forwarded a further request for particulars about the claim for care. On 7 August 1997 McLelland told McCabes (a) The claim was pursuant to s 59(f) (b) The applicant also relied on s 60(1) (c) referred the respondent to the report of Dial an Angel to explain how the cost was calculated. 226. Up until the appointment of the Protective Commissioner to manage Kim's affairs Mrs Lloyd was her personal representative and recognised as such by the Guardianship Board. 227. I draw the inference from this evidence that Mrs Lloyd intended to be paid for her services to Kim. 228. I also note in the context of Manning's case that Mrs Lloyd had on her daughters behalf caused McLellands Solicitors to present an account to the respondent through its solicitors seeking payment to Mrs Lloyd for her services to Kim. (e) Dealings with Newcastle Office GIO 229. Leslie Dickens the GIO Newcastle Claims Manager gave evidence that Kim Lloyd's file was transferred from Lismore to the Newcastle office in February 1997. He said he had not heard of a carers allowance and arranged a conference with his regional manager and Jenny Savvas of McCabes Solicitors to discuss how he should manage the file. As a result of that conference and the legal advice he received he made a request of Mrs Lloyd to provide daily diaries of the activities she was performing for her $300. 230. Mr Dickens told the Court that he had not read the Lismore File when he took over Management of Kim Lloyd's case nor did he contact the GIO officers in Lismore to ask them to explain what he did not understand. 231. Mr Dickens said he revisited the matter of Mrs Lloyd's allowance after he became aware of the decision in Manning's case and stopped the payments on legal advice. 232. I must say that I listened to Mr Dickens evidence with ever increasing incredulity. How he could take over a large case from another branch office and not read the files defies explanation. That as a claims officer in a large GIO office he had no knowledge of s 60 claims for services under s 59(f) of the 1987 Act is very difficult to believe. That he did not contact the Lismore officers handling the case for an explanation of what the $300 allowance was about is even harder to believe. He obviously knew there was something special about the claim because he organised a meeting with his Regional Manager and GIO's legal advisers. That he would go to such a meeting without reading the file or contacting the officers who had put the allowance in place is unbelievable. 233. The GIO's senior legal adviser in Newcastle who was well aware that Mrs Lloyd's legal advisers had made a s 60 claims for her services, provided particulars of her claim and issued legal proceedings against the GIO advised Mr Dickens to have Mrs Lloyd's account for her services to Kim on a daily basis. She was aware of the basis of Mrs Lloyd's claim. Yet the letter Mr Dickens sent to Mrs Lloyd in pursuance of legal advice following that meeting did not ask Mrs Lloyd to furnish particulars of payments she made to third parties for respite care of Kim. Nor did the reams of daily diaries that fill Mr Dickens file refer to the services of third parties. They all refer to work performed by Mrs Lloyd. 234. In the end Mr Dickens' lack of credibility is not relevant to my determination. What is relevant is the inference that this Court can draw from these facts about Mrs Lloyd's intention to bind her daughter in contract. 235. I find that Mrs Lloyd's dealings with the Newcastle office of the GIO raise the inference that she intended to be paid for her services by her daughter. (f) Subject Matter of the Contract 236. This is a case about 24 hour a day attendant care provided to a mentally disordered worker in her home environment at the direction of her medical advisers. It is provided in the context of a work injury and the employers insurers admission of liability to pay s 60 expenses. 237. In other words the context is a workers compensation case where the service provider was constantly in contact with the GIO, the employers workers compensation insurer about the provision of medical, rehabilitation, educational, vocational and recreational services to the worker. 238. Hall QC would distinguish Mrs Lloyd's situation from all the other service providers being paid by the GIO in this case on the basis that the true nature of the agreements with those providers was commercial and presumed to involve an intention to enter into legal relations. Mrs Lloyd on the other hand is the workers mother and he asserts that her familial relationship invokes the presumption that she never intended to bind her daughter to pay for her services. 239. Hall QC faced with the circumstance that the GIO was in fact paying Mrs Lloyd for her services would avoid the obvious implications by having this Court find that the payments were wrongly made by GIO officers outside the authorisation of their employer and under a mistake of law. 240. It is true that Mrs Lloyd was a cook not an attendant carer when she embarked upon the provision of her services and in that sense it is fair to say that the subject matter of the agreement might raise the question of whether it was domestic rather than commercial in nature. However there is another commercial reality here that to my mind needs to be taken into consideration. I refer to modern developments of statutory law concerning insurance schemes to compensate citizens personally injured at work, in motor vehicle accidents, by criminals or in sporting activities. 241. The widespread development of such schemes has profound implications for the common law presumption that family members would never intend to subject one another to litigation. 242. In this State family members injured in motor vehicle accidents regularly sue their negligent parents siblings and children in tort. Similarly injured workers frequently come before this Court suing family members who happen to be their employer and hold policies of workers compensation insurance. 243. The common law presumption that there are many agreements made within families that are never intended to give rise to litigation is still as valid today as when Justice Dixon gave his judgment in Cohens Case in 1929. However the advent of no fault liability schemes has seen Australians take a very different approach when they are reassured that the family member they are suing will have the verdict paid by an insurance company. 244. Whether this modern legal reality is seen as an example of a commercial as opposed to a domestic relationship or simply another circumstance where a rebuttal of the presumption is available, the fact is that Australians regularly engage in inter familial litigation when they know the family member being sued is covered by insurance. 245. In the circumstances of this case Mrs Lloyd was well aware that her daughter was entitled to workers compensation and that the GIO was paying out large sums of money to service providers for her daughters hospital and medical treatment as well as her rehabilitation and education. Indeed she was being paid herself by the GIO for transporting Kim for medical treatment and rehabilitation. 246. She also knew that Kim had an entitlement to a substantial sum of lump sum compensation for her injuries. Kim's medical advisers had told Mrs Lloyd that Kim's well being and perhaps her very survival depended upon that 24 hour care. 247. In all those circumstances this Court is entitled to draw the inference that Mrs Lloyd in agreeing to provide those services also intended to be paid for them knowing that the GIO was already footing the bill for similar services being provided by herself and other carers. 248. The fact that she approached the GIO to be paid is completely consistent with such an inference. 249. Again this is another circumstance where I take the view that the Court is entitled to draw a strong inference that Mrs Lloyd intended her daughter to be legally bound to pay, for her services. (g) Other payments for which Mrs Lloyd has held her daughter liable 250. Mrs Lloyd's evidence canvassed a series of other s 60 services she had provided for Kim in respect of which she billed the GIO and was paid. I refer in particular to the evidence that she was reimbursed under s 60(2)(b)for her costs in driving Kim to and from medical treatment, rehabilitation and therapy, vocational training and social outings. There were also costs paid for renovations to Mrs Lloyd's home and other aids such as an intercom to her daughter Marion's caravan. 251. Not only did Mrs Lloyd seek reimbursement for the use of her motor vehicle and its fuel but she later negotiated with the Protective Commissioner for the provision of an off road vehicle out of Kim's lump sum compensation. Mrs Lloyd uses that vehicle for her personal purposes as well as Kim's needs. She also negotiated the purchase of beef cattle, to run on her farm to assist in Kim's rehabilitation. 252. The fact that Mrs Lloyd took a commercial approach to all those matters again raises the inference that she was also prepared to hold her daughter liable for the attendant care. (i) The gravity of the detriment to Mrs Lloyd 253. The case law I have reviewed makes it clear that one of the matters that should be weighed in deciding whether or not an intention to create legal relations exists is whether Mrs Lloyd would take such a drastic step without requiring that Kim be bound to pay for her services. 254. I refer here to the matters I have previously raised under the heading "the extremely demanding nature of the task". Mrs Lloyd with full knowledge of what was involved embarked upon a herculean task for which she paid a heavy price in terms of the damage it has done to her emotional and physical health, her personal relationships and her social life. The financial detriment was great in itself, Mrs Lloyd's having to give up her full time job as a cook and rely upon social security to get by. 255. Again from these circumstances I draw the inference of an intention to enter into legal relations. COMPLIANCE WITH MANNING 256. Taking all these matters I have canvassed in detail into consideration along with all the other evidence on the balance of probabilities I determine that Mrs Lloyd in accepting the full time attendant care of Kim Lloyd on her discharge from hospital on 28 October 1993 intended to hold her daughter liable to pay for her services. I find no evidence to support the proposition that Mrs Lloyd had formed such an intention prior to 28 October 1993. 257. I have previously found that Mrs Lloyd's services were necessaries for a mentally disordered person. Having now found that Mrs Lloyd's role was that of a creditor not a benefactress I therefore determine that a binding agreement exists between Mrs Lloyd and her daughter and the Protective Commissioner as the manager of Kim Lloyd's financial affairs is obliged to pay for those necessaries out of her property. 258. Accordingly the first requirement in Manning's case of a binding contract for service between the worker and service provider has been proved. 259. Manning also requires that the worker present to his or her employer a bill from the service provider for indemnification. Because the strict requirements established in "Manning" were not known to legal advisers prior to 1998 and because Kim Lloyd was incapable of managing her own affairs proof of this requirement has its difficulties. 260. Up until the appointment of the Protective Commissioner to manage Kim Lloyd's affairs Mrs Lloyd as her mother undertook the role as her legal personal representative. That role was recognised by the Guardianship Tribunal in its determinations. 261. Early in 1995 Mrs Lloyd instructed McLellands Solicitors to act on her daughters behalf in respect of Kim's workers compensation entitlements. One of the claims made was for payment for Mrs Lloyd's services. 262. Wendy Klaus from the GIO noted its file that on 6 April 1995 Mr Ryan of McLellands had contacted her about payment of Mrs Lloyd's carers allowance. While that call certainly raised the question it could not properly be described as the presentation of a bill for indemnification. On 21 September 1995 McLellands sent a letter enclosing a draft Application for Determination which claimed "the cost of care in respect of the period from 17 January 1993 to date and continuing". Again in the strict sense this claim could not be properly described as a bill because the costs were neither itemised or quantified. 263. On 5 June 1996 in response to a request for particulars from the respondents then solicitors, McCabes, McLellands Solicitors itemised and costed the attendant care. On 7 August 1997 in response to a request for further and better particulars from McCabes, McLellands solicitors explained that the calculations in their earlier particulars were based on the report of Dial an Angel which had been provided. I take the view that it was at this point in time that the respondent through its solicitors had received a bill for indemnification from the worker and the fundamental requirements of Manning's Case had been met. 264. McLellands Solicitors subsequently made the Protective Commissioner aware of Mrs Lloyd's claim against her daughter. Mrs Lloyd, through her solicitor Mr Hemphill eventually served a detailed bill on the Protective Commissioner seeking indemnification on 25 September 1998 shortly before she commenced proceedings under s 61(8). The total amount claimed in that bill was $526, 409.48. 265. Hall QC's submission is that the late submission of invoices and accounts was clearly designed to overcome the effect of the decision in Manning. He asserts that the mere rendering of an invoice ex post facto does not generate or create a liability and it is the contract entered into between the worker and the medical service provider that gives rise to the primary liability under s 60. I agree. However I have found such a binding contract and I further find that Mrs Lloyd has complied with Manning by submitting to the duly appointed manager of her daughters financial affairs a bill for her services for indemnification. Estoppel 266. I have found a binding contract for necessaries and consequently do not need to make a determination on Mr Cooley's submission that the respondent because of its unconscionable conduct in inducing Mrs Lloyd to expect that she was entitled to be paid as a service provider under the Workers Compensation Act and that Kim Lloyd was entitled to claim for her services should be estopped from asserting that there was no binding contract. THE SCHEME FOR ESTABLISHING THE RATES APPLICABLE FOR MEDICAL OR RELATED TREATMENT 267. The scheme of the Workers Compensation Act 1987 which fixes an employers liability in respect of medical or related treatment is as follows: 1. S 59 defines the categories of medical or related treatment that are compensable under s 60. Everills Case raises questions as to whether all the services provided by Mrs Lloyd fall within s 59(f). Notwithstanding the respondents failure to put this matter in issue I find it prudent to make a determination as to whether the services meet the requirements of s 59(f) and consequently s 60. 2. S 60 limits the nature and extent of that defined treatment to that which is "reasonably necessary". I have previously considered the various criteria laid down in Roses Case and found that the treatment provided to Kim Lloyd at her doctors direction was reasonably necessary in that it was essential to, should be afforded to and should not be forborne by the worker. 3. S 60A puts a ceiling on the amount a worker has to pay and the service provider is entitled to recover. I have been requested to make a determination lifting that ceiling under s 61(4). 4. S 61 then empowers the Court to fix the rates applicable for that reasonably necessary treatment applying a set of criteria. 268. In Radulovic I considered the policy considerations underlying the Legislatures enactment of s 61. The Parliament was obviously concerned to constrain the burgeoning costs of the workers compensation scheme to relieve the upward pressures on employers insurance premiums and maintain the viability of the scheme. 269. S 61(1) is the tool used in this process aimed, in my opinion, at the trade practice in health industry of imposing premiums on medical services provided to workers who are compensation beneficiaries. S 61(1) requires the Court to ensure that the amount paid for a particular service is reasonably appropriate to the treatment having regard to the fees customarily charged for such services to non workers in the relevant community. 270. S 61(5) limits the amount payable for s 51(f) services by requiring the Court to take into consideration "the extent to which care might be expected to be provided by the workers spouse or other person residing with the worker". RESOLVING THE AMOUNT FOR WHICH THE RESPONDENT IS LIABLE FOR MRS LLOYD'S SERVICES 271. Having resolved the issues of a binding agreement, the submission of a bill of costs and the reasonable necessity for Mrs Lloyd's services the final question is the extent to which Kim Lloyd should be indemnified for those services. 272. Both the Protective Commissioner and Mrs Lloyd base their claims on the costing of Dial an Angel. Mrs Lloyd also brought evidence about award rates for attendant carers. The primary purpose of that exercise was to maintain a suit in contract or quasi contract against the GIO. I have determined that I have no jurisdiction to hear claims under the general law of contract. Ms Gordon's evidence is however useful to test Dial an Angel's costings. 273. The respondent chose not to put any evidence before the Court that went to whether or not Mrs Lloyd's claim was reasonably appropriate to the treatment having regard to the fees customarily charged for such services to non workers in the relevant community. The respondent was in a position to assist the Court further on this question having consented to an award on 13 October 1998 to provide 24 hour a day care through a suitable agency. Counsels advice to the Court indicates that care is being provided by the Clarence Valley Home Nursing Service. Details of the cost of that service have not been put into evidence. I draw the inference that the respondents case would not have been assisted by presenting that evidence. 274. The respondent bears the s 61(1) onus of proving the fees customarily charged to non workers in Kim Lloyd's community but has chosen not to present evidence to discharge that onus. The Court is therefore left with bills from McLellands and Mr Hemphill both based on the assessment of Dial an Angel in making its assessment as to whether the costs charged for Mrs Lloyd's services are reasonably appropriate in all the circumstances of the case. Dial an Angel 275. Three reports from Dial an Angel are in evidence dated 27 February 1996, 22 May 1997 and 16 February 1998. In the first report Mrs Lloyd's duties are assessed as follows: 1. Constant supervisory care and companionship. 2. Motivation, prompting and direction in all daily activities. 3. Financial guidance and assistance with budgeting. 4. Personal care - involving assistance with bathing and drying, dressing and undressing, toiletting and grooming (hair washing, nail clipping, teeth cleaning etc), the tray service of meals, assistance with transfers to and from bed, chair, in and out of motor vehicles, the monitoring and administering of medications, night-time attendances, assistance with therapies and exercises, personal shopping, letter writing and a multitude of other personal services. 5. Housekeeping assistance, laundry (washing and ironing) changes of bed linen, bed making, the general maintenance cleaning of home, attentions to hot plates, oven and refrigerator, freezer, the preparation, cooling, cutting up and service of meals and shopping for the household provisions. 6. Driving and or accompanying to activities remote from home. 7. Handyman gardener services. 276. Dial an Angel emphasised at page 5 of its first report that: The responsibility of caring for the brain-injured person is often beyond one persons physical and emotional resources in a long term arrangement. 277. Dial an Angel then provided the following quotes: 1. For a live-in housekeeper attendant carer on call 24 hours a day 5 days a week. 1994 $950 gross per week 1995 $1,000 gross per week 1996 $1,000 gross per week 2. Relief care to be calculated at $250 per day. 3. Handyman Gardener Services $21 per hour. 278. Then in their report of 16 February 1998 after further considering Professor Oakeshott's directions as to the precise care needed Dial an Angel offered the additional costings: 1. For a live in primary housekeeper attendant carer on a long term or permanent basis: 1997 $1,125 per week plus keep 1998 $1,250 per week plus keep 279. Keep was assessed at $21.25 per day per person or $148.75 per week. 280. Penalty rates of double time and a half were suggested for public holidays. S 59(f) 281. Having considered all the evidence including that of Professor Oakeshott, Mrs Lloyd and Dial an Angel I have no difficulty in reaching the conclusion that for a profoundly brain damaged worker with significant continuing orthopaedic impairments, who has a wide range of worrying vulnerability's and physical disabilities as well as displaying violent and aggressive behaviour that the services recommended by Dial an Angel are essential to Kim Lloyd's health and personal well being. 282. I have reached this conclusion after reading Mrs Lloyd's evidence over 5 days of hearing her two statements and her daily report sheets to the GIO; on reading the medical reports tendered notably those of Professor Oakeshott, Dr Buckley, Dr Palmer and Dr Endrey-Walder; on reading the reports of the various para medicals notably Dial an Angel, Joan Cronin (occupational therapist), Anne Marie McFadyen (Head Injury Service) Occupational Therapists (G Smith and H Benari) Jeanette Malberg (TAFE) Work Directions Australia (Julie Wilson). I noted in absorbing all this evidence that there was some gradual improvement in Kim Lloyd's disabilities over the 5 years Mrs Lloyd was her attendant carer. Generally speaking I noted that Mrs Lloyd provided the following personal care: · Personal Hygiene 283. Kim was grossly incontinent in the early years. She had improved by 1998 but still had bowel and bladder accidents that regularly required Mrs Lloyd's attention. Kim had to be showered and assisted with toiletting. She had to be shaved and assisted to clean her teeth. Her clothing had to be changed on a fairly regular basis. · Cooking and Feeding 284. Kim was able to make sandwiches later in the period of care. However she had to be watched around hot plates, electrical appliances and refrigerators. Mrs Lloyd prepared her meals and assisted her eat then. Kim had a problem of choking on food that needed to be watched closely. · Driving 285. A considerable amount of Mrs Lloyd's time was taken up driving her daughter to and fro appointments with medical practitioners, physiotherapists, hydrotherapists, masseurs, to swimming, to TAFE, for entertainment, for outings and to respite care facilities. 286. The distances involved were frequently quite lengthy with regular trips to Grafton, Lismore and other trips as far as Port Macquarie and Byron Bay. 287. Travelling expenses are covered by s 60(2)(a) and s 64 and were in fact paid to Mrs Lloyd by the respondent. · Keeping Kim Amused 288. Mrs Lloyd's accounts to the GIO on her daily activities reveal the considerable amount of time she spent each day simply keeping the childlike Kim amused. 289. Activities included watching "soaps" on TV, bike riding, visits to the cows and chooks, carrying out remedial exercises, helping her with the computer, taking her for walks. This aspect of personal care was difficult because of Kim's aggressive behaviour, tendency to decamp and propensity to take falls. · Dressing Kim 290. Kim required help to dress and undress. She needed changes during the day at times. There was laundry work associated with this form of care. · Controlling and Protecting Kim 291. Kim was given to violent and aggressive behaviour when she could not get her own way. Occasionally this problem got to the stage when Mrs Lloyd needed police assistance. Mostly Mrs Lloyd had to do her best to manage the problem. Sometimes Kim's aggression became quite nasty particularly when she became jealous of small children. 292. Not only was Kim at risk of physically injuring herself but she became sexually frustrated. Her uninhibited and inappropriate sexual behaviour required vigilance on Mrs Lloyd's behalf. 293. Kim also had problems sleeping. She smoked and Mrs Lloyd had to check to see she did not burn herself when she fell asleep. Kim also needed attention during the night. · Housekeeping and Gardening 294. A few of the services mentioned in Dial an Angels quote would appear not to meet the test of the decision of the Court of Appeal in Everills case. 295. Clearly the handyman/gardening services can no longer be considered to fall within the definition of medical related services. They appear to me to have little to do with Kim Lloyd in any event other than the need to ensure the appliances used were in good order. 296. There is no suggestion of any therapeutic value in the gardening. 297. I have much more difficulty with the housekeeping services which are not exhaustively particularised by Dial an Angel. Justice Handley makes it clear at paragraph 24 of his judgment that it was not the intention of Parliament to confer a right upon workers under s 59(f) to recover the cost of domestic assistance. My difficulty lies in understanding precisely where Justice Handley sees the limits to "personal care" in circumstances where "the worker who is unable to look after herself either at all, or without suffering unacceptable pain, is entitled to the cost of personal care." 298. The evidence in this case is that Kim Lloyd can do some minor things of a domestic nature for herself. However she puts herself at risk from burns or other injury when she tries to make simple things such as toast or coffee and the evidence is that she is both mentally and physically incapable of carrying out on any regular basis domestic tasks such as washing, ironing or cleaning of her room. 299. At paragraph 25 of his judgment Justice Handley says work which cannot be characterised as care for a worker does not become such merely because the injured worker cannot continue to do it without unacceptable pain or risk of aggravating the injury. 300. Justice Handley had earlier noted with approval Chief Judge McGrath's rejection of costs in Hugo v Coles Myer Limited (25 July 1989 unreported) where "in broad terms, it seems to be that the care provided here is really a replacement of the applicant as a wife and mother, in relation to her family, rather than treatment accorded to her". 301. Kim Lloyd at the time of her injury was living with her defactos parents in Grafton. There is no suggestion that the domestic services provided to her were in any way a substitution for those she would have been providing in her own home environment. Mrs Lloyd took her into her Half Way Creek home for the specific purpose of providing the personal care directed by Kim's medical advisers. 302. Domestic services such as making beds and laundering soiled linen and clothing of a patient with an incontinence problem or propensity to spill food and dirty herself seem to fall squarely within personal care. Taking special care with the maintenance and cleaning of household appliances such as ovens, hot plates and refrigerators being used by a handicapped person also seems to me to be personal care. Special preparation of food for a person with difficulties in feeding herself again would appear to be personal care. 303. It could well be that Mrs Lloyd's housekeeping services involve both personal care which is compensable under s 59(f) and some things of a domestic nature that might not meet Justice Handley's strict test. 304. Dial an Angel have not differentiated in their costing between the individual cost of domestic services. Rather they have estimated a global figure covering all forms of personal care. 305. The industrial reality of a 24 hour attendant carers services is that the carer is being paid for a range of services throughout the day and night. The primary service is simply being there. By my calculations the rate is a little more than $8 per hour which is far below the hourly rate which would be earned as a housekeeper. 306. Accordingly, while it is possible that the gardening services and some aspects of the housekeeping service actually recommended may not meet the strict requirements of s 59(f) I take the view that because the 24 hour attendant care services is provided at a medical practitioners direction and the nature of the service provided is overwhelmingly personal care then the cost of the attendant care falls within the provisions of s 59(f). S 61(2) 307. S 61(2) imposes a limit on the amount payable by employers for medical and related treatment. 308. S 61(4) and s 61(4A) empower this Court to direct that a greater amount be paid. 309. I have been asked to make such a direction by the parties. I am aware of the quantum of this claim and have some idea of the continuing costs of attendant care being currently provided. However I have not been supplied with details of the current amount that has been paid in this case for medical and related expenses. The total cost would already be greatly in excess of the s 61(2) maximum. Until such time I have had the assistance of a detailed account I propose to direct that an additional amount of $2 million be added to the respondents liability for medical and related treatment. RESOLVING THE COST QUESTION 310. Both claimants have relied upon Dial an Angels costings. For convenience sake I propose to resolve the question of the cost of this claim for attendant care by applying ss 60 and 61 to the bill submitted by Mr Hemphill to the Protective Commissioner for payment. 311. The first three items in Mr Hemphill's account relate to services provided prior to 28 October 1993. They are: A. 18.1.97 to 10.2.93 services at Royal North Shore Hospital $2,672.48 B. 11.2.93 to 10.6.93 services at Rehabilitation Unit Ryde $21,522.00 C. 11.6.93 to 28.10.93 services at St Vincents Hospital Lismore $2,535.00 Total Claim $26,729.48 312. I reject all three claims on two grounds viz: 1. My finding is that there is no implied contract between Mrs Lloyd and her daughter until 28 October 1993 because Mrs Lloyd has not proved she intended to constitute herself her daughters creditor before that date. 2. S 61(5) insists that this Court have regard to the extent to which care might be expected to be provided by a person residing with the worker. My finding is that in this case which involves great personal commitment and sacrifice for the long term that it was no longer reasonable to expect of such voluntary care from the time 24 hour a day care became necessary. D. 28 October 1993 to 31.12.95 313. Two claims are made here: 1. A claim for attendant care for 5 days a week for 113 weeks at the rate of $950 per week $107,350.00 2. A claim for attendant care at penalty rates for Saturday and Sunday for 113 weeks at $460 per weekend $51,980.00 314. These claims are based on Dial an Angels assessments. The respondent brings no evidence to refute them. 315. Ms Gordon from the Miscellaneous Workers Union whose job it was to service the Home Care Industry (State) Award calculated the entitlement for one of her unions members carrying out Mrs Lloyd's work to be: 28.10.93 to 3.2.94 $41,632.81 and for the week 4.2.94 to 31.5.95 $99,097.44 316. It can be seen therefore that a live in house worker under that award would probably have earned more than Dial an Angel would have charged for the service given the period ended on 31 December 1995. However when one takes the additional factors already in the award rate such as keep, sick pay, holiday pay and superannuation into account there seems to be little difference in the two assessments. Accordingly I find these charges to be reasonably appropriate. 1996,1997 and 1998 317. Having taken that approach I find that Dial an Angels estimates for 1996, 1997 and 1998 were also reasonably appropriate. 318. I also find the claims for "keep" for Mrs Lloyd as well as the claims for holiday pay, sick pay and superannuation reasonably appropriate. 319. Mr Hemphill's account was dated 25 September 1998 and the Clarence Valley Nursing Service did not take over Kim's care until 13 October 1998. I have taken that period into consideration based on the 1998 rate. Basis of Calculations 1. 28 October 1993 to 31 December 1995 · 5 days per week for 113 weeks at $950 weekly $107,350 · Saturday and Sunday for 113 weeks at $460 $51,980 2. 1 January 1996 to 31 December 1996 · 5 days per week for 52 weeks at $1,000 weekly $52,000 · Saturdays and Sundays for 52 weeks at $460 $239,920 3. 1 January 1997 to 31 January 1997 · 5 days per week for 52 weeks at $1,125 weekly $58,500 · Saturdays and Sundays for 52 weeks at $600 weekly $31,200 4. 1 January 1998 to 13 October 1998 · 5 days per week for 42 weeks at $1,250 $52,500 · Saturdays and Sundays for 42 weeks at $650 $27,300 5. "Keep" 259 weeks at $110 $28,490 6. Holiday pay 20 weeks at $1,250 $25,000 7. Sick pay 5 weeks at $1,250 $6,250 8. Superannuation 28.10.93 to 13.10.98 estimate $23,000 9. Kim Lloyd's "Keep" 259 weeks at $110 $28,490 Total Amount due to 13.10.98 $515,980 Less Paid by GIO $72,800 Total $443,180 320. The worker is therefore entitled to be indemnified for s 60 expenses of $515,980 in respect of Mrs Lloyd's services. From that figure needs to be deducted the sum already paid by the GIO namely $72,800 leaving an amount outstanding of $443,180. 321. I find therefore that the Protective Commissioner is entitled to be indemnified under s 60 for Mrs Lloyd's claim for attendant carers services in the sum of $443,180. INTEREST 322. A brief history of the interest provisions in the workers compensation legislation is necessary to understand what provisions apply to this claim: · S 19 of the Compensation Court Act 1984 gave this Court an unrestricted power to award interest. · On 1 February 1996 s 19 was repealed and replaced by s 113 of the 1987 Act. · The transitional provisions namely sch 4 pt 4 cl 7(1) of the 1984 Act allowed this Court in proceedings commenced prior to 1 February 1996 to continue to award interest under s 19. However because these proceedings were commenced on 26 September 1996 s 113 of the 1987 Act applied to them. · Sch 6 Pt 11 Cl 1 of the 1987 Act which became operative on 12 January 1997 said s 113(2) did not apply to the ordering of interest on injuries commenced before that commencement date and instead imposed different restrictions set out in subclause 1(a). Because Kim Lloyd's injury was received in 1993 subclause 1(a) applies here. · Subclause 1(a) forbade an award of interest on any compensation payable for any period before the claim was duly made or in situations where no claim was duly made for any period before the worker gave the employer particulars. · S 109(1) of the 1998 Act then replaced s 113 although it is in the same terms. S 109(2)(b) also forbids interest being awarded for any period before the claim was duly made. 323. There is no suggestion here that the claim was not duly made. The amendments in 1996 and 1997 imposed restrictions on commencement of proceedings for lump sum weekly benefits claims but not s 60 claims. The 1998 amendments imposed a conciliation process on s 60 claims but the transitional provisions saved claims that had already been commenced. Nevertheless the 1987 Act and the Court Rules require that at the very least claims be made in writing. 324. The first written claim for 24 hour attendant care expenses pursuant to s 60 was the letter from McLellands Solicitors on 21 September 1995 which enclosed a draft Application for Determination giving particulars of that claim. I determine that whilst the contract commenced on 28 October 1993 interest should be calculated from 21 September 1995. 325. The worker is therefore entitled to an order for interest on the $443,180 but not before McLellands Solicitors made the claim for s 60 expenses on 21 September 1995. 326. At the Compensation Court Conference Jamberoo in 1994 a schedule of setting out a common approach to interest was agreed upon by the Judges of this Court. It was designed to apply to run of the mill cases not exceptional ones. Unfortunately it does not consider s 60 expenses and this is not a run of the mill case. I can find no authorities from this Court that consider interest on s 60 expenses. 327. Manning's Case holds that there are no damages involved in a claim under s 60 and that the process here is the indemnification of a contractual obligation or debt. This means that the case law on interest in cases for damages for personal injuries is not relevant to a s 60 award. Accordingly the case law such as Metropolitan Meat Industry Board v Williams (1991) 24 NSWLR 54 and MBP (SA) Pty Limited v Gogic (1990 - 1991) 171 CLR 656 which applies an arbitrary 4 per cent interest rate to non economic loss of the Griffiths v Kerkemeyer kind is not applicable. 328. The appropriate approach appears to me to apply the rate of interest set out in Sch J of the Supreme Court Rules halved to take into account the progressive nature of the debt between the making of the written claim in September 1995 and this judgment. 329. However I am mindful that we are dealing here with a claimant whose financial affairs are administered by the Protective Commissioner pursuant to the provisions of the Protected Estates Act. The regulations to that Act entitle the Protective Commissioner to deduct an administration fee from any s 60 award. I understand that the fee involves a sliding scale beginning at 4 per cent on the first $100,000 and reducing to by one per cent per $100,000 to a flat fee of 1 per cent. This means that the s 60 award would be reduced by approximately $10,000. 330. In GIO of NSW v Rosniak (1992) 27 NSWLR 665 the Court of Appeal addressed this problem when establishing a management fund for a protected person entitled to damages for personal injury. The Court solved the problem by increasing the interest rate from 4 to 5 per cent to allow for the management fee. 331. I propose to increase the halved Sch J rate by a further 0.5 per cent to take the management fee into account. 332. The calculation is as follows: Principal = $443,180 Rate under Sch J = 11 per cent Half rate = 5.5 per cent Plus 0.5 per cent = 6.0 per cent Term = 5.6 years Interest = $148,908 FINDINGS 333. I summarise my findings as follows: 1. The worker was injured arising out of and in the course of her employment with the respondent. 2. The worker sustained as a result of her injuries permanent organic brain damage and orthopaedic injuries entitling her to an award of the maximum lump sum compensation payable under the Act. She also sustained a psychological injury. 3. As a result of her psychological injury the worker is incapable of managing her own affairs and incapable of entering into a binding contract. 4. Kathleen Lloyd, the workers mother has standing to bring a claim against the respondent pursuant to s 61(8) of the 1987 Act. This Court has jurisdiction to hear that claim as it is a matter arising under the Act. However it is a derivative claim and cannot be sustained unless the workers substantive claim under s 60 is first proved. 5. This Court has no jurisdiction to hear Mrs Lloyd's claims against the GIO based on the general law of contract. 6. The implications of the decision in Mannings Case for the claims before the Court are that they must be founded upon: (a) a binding contract for service made between the worker and the service provider. (b) a claim made by the worker by the presentation of a bill for indemnification of costs incurred under that binding contract. 7. (a) One of the elements of a binding contract is an intention to enter into legal relations. That intention must be determined by outward manifestations not the subjective intent of the parties. (b) The common law presumes that where there is a close familial relationship that agreements between family members are not intended to give rise to a binding legal relationship or be attended by legal consequence. (c) That presumption is rebuttable. The factors that a Court will give weight to in deciding whether or not the agreement was meant to be binding include: (i) a clear intention to be bound (ii) the commercial nature of the agreement (iii) the gravity of the detriment to the party seeking to enforce the contract 8. (a) Where necessaries are supplied to a person suffering from a mental disorder there is an implied contract. (b) That implication is rebuttable by proof that the person supplying the service did so as a benefactor and did not intend to be a creditor. (c) Justice Meaghers remarks at paragraph 11 of his judgment in "Manning" do not create a new legal principle. Rather they simply refer to the lack of evidence in that case to prove a contract for services between the worker and the service provider. 9. (a) The worker is a mentally disordered person to whom the law of necessaries applies. (b) The services provided by Mrs Lloyd to the worker were necessaries. 10. While some minor aspects of the housekeeping services provided by Mrs Lloyd may not meet the strict requirements of s 59(f) the nature of the services provided was overwhelmingly personal care and accordingly fell within the definition of medical and related services in s 59(f). 11. (a) The worker has established a prima facie case for relevant treatment for the purposes of s 60. The respondent has not sought to rebut that case. (b) The necessity for the treatment results from the injury and its purpose and potential effect is to alleviate the consequence of the injury. (c) It is reasonably necessary that such treatment be afforded to the worker because it is essential to, should be afforded to an should not be forborne by the worker. (d) The treatment has been directed by the workers medical practitioners and there is no evidence to suggest that it is not appropriate, or there are cheaper or better alternative treatments. 12. (a) I have found on the balance of probabilities that Mrs Lloyd in accepting the full time attendant care of Kim Lloyd on her discharge from hospital on 28 October 1993 intended to hold her daughter liable to pay for her services. In other words there is a binding contract of service and the Protective Commissioner as the manager of Kim Lloyd's financial affairs is legally obliged to pay for those necessaries out of her property. (b) I find that no contract for necessaries existed between Mrs Lloyd and her daughter prior to 28 October 1993. 13. It is not necessary for me to determine Kathleen Lloyd's claim for equitable relief on the grounds that the GIO's unconscionable conduct in inducing her to believe that both Kim Lloyd and herself had rights under s 60 estopped the respondent from denying the existence of a binding contract. 14. Pursuant to ss 61(4) and 61(4A) I direct that an additional amount of $2 million be added to the respondents liability for medical and related treatment. 15. (a) The respondent has failed to discharge its onus to prove the fees customarily charged to non workers in Kim Lloyd's community. The Court must therefore resolve the question of the appropriate costings of the claim pursuant to s 61(1) by deciding whether or not the fees claimed by Mrs Lloyd were reasonably appropriate to the treatment given. (b) Mrs Lloyd's claims totalling $26,729.48 for services rendered prior to 28 October 1993 fail (i) because no binding agreement existed for those services and (ii) because I would have applied s 61(5) in any event. (c) I find that the rest of the fees claimed based on Dial an Angels costings are reasonably appropriate to the treatment given. The worker is therefore entitled to be indemnified pursuant to s 60 for Mrs Lloyd's attendant care services between 28 October 1993 and 13 October 1998 in the sum of $443,180. 16. The worker is entitled to have included in the award interest on the s 60 expenses found at the rate of 6.0 per cent per annum from 21 September 1995 to judgment. AWARDS 334. I make the following awards: 1. The respondent indemnify the worker for the services of Kathleen Lloyd pursuant to s 60 in the sum of $443,180. 2. The respondent pay to the worker interest on the sum awarded in the sum of $148,908. 3. The respondent pay the costs of both the worker and Kathleen Lloyd. Mr Bauer instructed by McLellands Solicitors appeared for the Protective Commissioner Mr Cooley instructed by Hemphill & Co Solicitors appeared for Kathleen Lloyd Mr Hall QC with Mr Priestley instructed by Hunt & Hunt Solicitors appeared for the respondent DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.